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G.R. No.

183409 June 18, 2010

CHAMBER OF REAL ESTATE AND BUILDERS ASSOCIATIONS, INC.


(CREBA), petitioner,
vs.
THE SECRETARY OF AGRARIAN REFORM, Respondent.

DECISION

PEREZ, J.:

This case is a Petition for Certiorari and Prohibition (with application for
temporary restraining order and/or writ of preliminary injunction) under Rule 65 of
the 1997 Revised Rules of Civil Procedure, filed by herein petitioner Chamber of
Real Estate and Builders Associations, Inc. (CREBA) seeking to nullify and
prohibit the enforcement of Department of Agrarian Reform (DAR) Administrative
Order (AO) No. 01-02, as amended by DAR AO No. 05-07,1and DAR
Memorandum No. 88,2 for having been issued by the Secretary of Agrarian
Reform with grave abuse of discretion amounting to lack or excess of jurisdiction
as some provisions of the aforesaid administrative issuances are illegal and
unconstitutional.

Petitioner CREBA, a private non-stock, non-profit corporation duly organized and


existing under the laws of the Republic of the Philippines, is the umbrella
organization of some 3,500 private corporations, partnerships, single
proprietorships and individuals directly or indirectly involved in land and housing
development, building and infrastructure construction, materials production and
supply, and services in the various related fields of engineering, architecture,
community planning and development financing. The Secretary of Agrarian
Reform is named respondent as he is the duly appointive head of the DAR
whose administrative issuances are the subject of this petition.

The Antecedent Facts

The Secretary of Agrarian Reform issued, on 29 October 1997, DAR AO No. 07-
97,3 entitled "Omnibus Rules and Procedures Governing Conversion of
Agricultural Lands to Non-Agricultural Uses," which consolidated all existing
implementing guidelines related to land use conversion. The aforesaid rules
embraced all private agricultural lands regardless of tenurial arrangement and
commodity produced, and all untitled agricultural lands and agricultural lands
reclassified by Local Government Units (LGUs) into non-agricultural uses after 15
June 1988.

Subsequently, on 30 March 1999, the Secretary of Agrarian Reform issued DAR


AO No. 01-99,4 entitled "Revised Rules and Regulations on the Conversion of
Agricultural Lands to Non-agricultural Uses," amending and updating the
previous rules on land use conversion. Its coverage includes the following
agricultural lands, to wit: (1) those to be converted to residential, commercial,
industrial, institutional and other non-agricultural purposes; (2) those to be
devoted to another type of agricultural activity such as livestock, poultry, and
fishpond the effect of which is to exempt the land from the Comprehensive
Agrarian Reform Program (CARP) coverage; (3) those to be converted to non-
agricultural use other than that previously authorized; and (4) those reclassified
to residential, commercial, industrial, or other non-agricultural uses on or after the
effectivity of Republic Act No. 66575 on 15 June 1988 pursuant to Section 206 of
Republic Act No. 71607 and other pertinent laws and regulations, and are to be
converted to such uses.

On 28 February 2002, the Secretary of Agrarian Reform issued another


Administrative Order, i.e., DAR AO No. 01-02, entitled "2002 Comprehensive
Rules on Land Use Conversion," which further amended DAR AO No. 07-97 and
DAR AO No. 01-99, and repealed all issuances inconsistent therewith. The
aforesaid DAR AO No. 01-02 covers all applications for conversion from
agricultural to non-agricultural uses or to another agricultural use.

Thereafter, on 2 August 2007, the Secretary of Agrarian Reform amended certain


provisions8 of DAR AO No. 01-02 by formulating DAR AO No. 05-07, particularly
addressing land conversion in time of exigencies and calamities.

To address the unabated conversion of prime agricultural lands for real estate
development, the Secretary of Agrarian Reform further issued Memorandum No.
88 on 15 April 2008, which temporarily suspended the processing and approval
of all land use conversion applications.

By reason thereof, petitioner claims that there is an actual slow down of housing
projects, which, in turn, aggravated the housing shortage, unemployment and
illegal squatting problems to the substantial prejudice not only of the petitioner
and its members but more so of the whole nation.

Hence, this petition.

The Issues

In its Memorandum, petitioner posits the following issues:

I.

WHETHER THE DAR SECRETARY HAS JURISDICTION OVER LANDS THAT


HAVE BEEN RECLASSIFIED AS RESIDENTIAL, COMMERCIAL, INDUSTRIAL,
OR FOR OTHER NON-AGRICULTURAL USES.

II.

WHETHER THE DAR SECRETARY ACTED IN EXCESS OF HIS


JURISDICTION AND GRAVELY ABUSED HIS DISCRETION BY ISSUING AND
ENFORCING [DAR AO NO. 01-02, AS AMENDED] WHICH SEEK TO
REGULATE RECLASSIFIED LANDS.

III.

WHETHER [DAR AO NO. 01-02, AS AMENDED] VIOLATE[S] THE LOCAL


AUTONOMY OF LOCAL GOVERNMENT UNITS.

IV.

WHETHER [DAR AO NO. 01-02, AS AMENDED] VIOLATE[S] THE DUE


PROCESS AND EQUAL PROTECTION CLAUSE[S] OF THE CONSTITUTION.

V.

WHETHER MEMORANDUM NO. 88 IS A VALID EXERCISE OF POLICE


POWER.9

The subject of the submission that the DAR Secretary gravely abused his
discretion is AO No. 01-02, as amended, which states:
Section 3. Applicability of Rules. These guidelines shall apply to all applications
for conversion, from agricultural to non-agricultural uses or to another agricultural
use, such as:

xxxx

3.4 Conversion of agricultural lands or areas that have been reclassified by the
LGU or by way of a Presidential Proclamation, to residential, commercial,
industrial, or other non-agricultural uses on or after the effectivity of RA 6657
on 15 June 1988, x x x. [Emphasis supplied].

Petitioner holds that under Republic Act No. 6657 and Republic Act No.
8435,10 the term agricultural lands refers to "lands devoted to or suitable for the
cultivation of the soil, planting of crops, growing of fruit trees, raising of livestock,
poultry or fish, 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 a person whether natural or juridical, and not classified by the
law as mineral, forest, residential, commercial or industrial land." When the
Secretary of Agrarian Reform, however, issued DAR AO No. 01-02, as amended,
he included in the definition of agricultural lands "lands not reclassified as
residential, commercial, industrial or other non-agricultural uses before 15 June
1988." In effect, lands reclassified from agricultural to residential, commercial,
industrial, or other non-agricultural uses after 15 June 1988 are considered to be
agricultural lands for purposes of conversion, redistribution, or otherwise. In so
doing, petitioner avows that the Secretary of Agrarian Reform acted without
jurisdiction as he has no authority to expand or enlarge the legal signification of
the term agricultural lands through DAR AO No. 01-02. Being a mere
administrative issuance, it must conform to the statute it seeks to implement, i.e.,
Republic Act No. 6657, or to the Constitution, otherwise, its validity or
constitutionality may be questioned.

In the same breath, petitioner contends that DAR AO No. 01-02, as amended,
was made in violation of Section 6511 of Republic Act No. 6657 because it covers
all applications for conversion from agricultural to non-agricultural uses or to
other agricultural uses, such as the conversion of agricultural lands or areas that
have been reclassified by the LGUs or by way of Presidential Proclamations, to
residential, commercial, industrial or other non-agricultural uses on or after 15
June 1988. According to petitioner, there is nothing in Section 65 of Republic Act
No. 6657 or in any other provision of law that confers to the DAR the jurisdiction
or authority to require that non-awarded lands or reclassified lands be submitted
to its conversion authority. Thus, in issuing and enforcing DAR AO No. 01-02, as
amended, the Secretary of Agrarian Reform acted with grave abuse of discretion
amounting to lack or excess of jurisdiction.

Petitioner further asseverates that Section 2.19,12 Article I of DAR AO No. 01-02,
as amended, making reclassification of agricultural lands subject to the
requirements and procedure for land use conversion, violates Section 20 of
Republic Act No. 7160, because it was not provided therein that reclassification
by LGUs shall be subject to conversion procedures or requirements, or that the
DARs approval or clearance must be secured to effect reclassification. The said
Section 2.19 of DAR AO No. 01-02, as amended, also contravenes the
constitutional mandate on local autonomy under Section 25,13 Article II and
Section 2,14 Article X of the 1987 Philippine Constitution.

Petitioner similarly avers that the promulgation and enforcement of DAR AO No.
01-02, as amended, constitute deprivation of liberty and property without due
process of law. There is deprivation of liberty and property without due process of
law because under DAR AO No. 01-02, as amended, lands that are not within
DARs jurisdiction are unjustly, arbitrarily and oppressively prohibited or restricted
from legitimate use on pain of administrative and criminal penalties. More so,
there is discrimination and violation of the equal protection clause of the
Constitution because the aforesaid administrative order is patently biased in
favor of the peasantry at the expense of all other sectors of society.

As its final argument, petitioner avows that DAR Memorandum No. 88 is not a
valid exercise of police power for it is the prerogative of the legislature and that it
is unconstitutional because it suspended the land use conversion without any
basis.

The Courts Ruling

This petition must be dismissed.

Primarily, although this Court, the Court of Appeals and the Regional Trial Courts
have concurrent jurisdiction to issue writs of certiorari, prohibition, mandamus,
quo warranto, habeas corpus and injunction, such concurrence does not give the
petitioner unrestricted freedom of choice of court forum.15 In Heirs of
Bertuldo Hinog v. Melicor,16 citing People v. Cuaresma,17 this Court made the
following pronouncements:

This Court's original jurisdiction to issue writs of certiorari is not exclusive. It is


shared by this Court with Regional Trial Courts and with the Court of Appeals.
This concurrence of jurisdiction is not, however, to be taken as according to
parties seeking any of the writs an absolute, unrestrained freedom of choice of
the court to which application therefor will be directed. There is after all a
hierarchy of courts. That hierarchy is determinative of the venue of appeals, and
also serves as a general determinant of the appropriate forum for petitions for the
extraordinary writs. A becoming regard for that judicial hierarchy most certainly
indicates that petitions for the issuance of extraordinary writs against first level
("inferior") courts should be filed with the Regional Trial Court, and those against
the latter, with the Court of Appeals. A direct invocation of the Supreme Courts
original jurisdiction to issue these writs should be allowed only when there are
special and important reasons therefor, clearly and specifically set out in the
petition. This is [an] established policy. It is a policy necessary to prevent
inordinate demands upon the Courts time and attention which are better devoted
to those matters within its exclusive jurisdiction, and to prevent further over-
crowding of the Courts docket.18 (Emphasis supplied.)

The rationale for this rule is two-fold: (a) it would be an imposition upon the
precious time of this Court; and (b) it would cause an inevitable and resultant
delay, intended or otherwise, in the adjudication of cases, which in some
instances had to be remanded or referred to the lower court as the proper forum
under the rules of procedure, or as better equipped to resolve the issues
because this Court is not a trier of facts.19

This Court thus reaffirms the judicial policy that it will not entertain direct resort to
it unless the redress desired cannot be obtained in the appropriate courts, and
exceptional and compelling circumstances, such as cases of national interest
and of serious implications, justify the availment of the extraordinary remedy of
writ of certiorari, calling for the exercise of its primary jurisdiction.20

Exceptional and compelling circumstances were held present in the following


cases: (a) Chavez v. Romulo,21 on citizens right to bear arms; (b) Government of
[the] United States of America v. Hon. Purganan,22 on bail in extradition
proceedings; (c) Commission on Elections v. Judge Quijano-Padilla,23 on
government contract involving modernization and computerization of voters
registration list; (d) Buklod ng Kawaning EIIB v. Hon. Sec. Zamora,24on status and
existence of a public office; and (e) Hon. Fortich v. Hon. Corona,25 on the so-
called "Win-Win Resolution" of the Office of the President which modified the
approval of the conversion to agro-industrial area.26

In the case at bench, petitioner failed to specifically and sufficiently set forth
special and important reasons to justify direct recourse to this Court and why this
Court should give due course to this petition in the first instance, hereby failing to
fulfill the conditions set forth in Heirs of Bertuldo Hinog v. Melicor.27 The present
petition should have been initially filed in the Court of Appeals in strict
observance of the doctrine on the hierarchy of courts. Failure to do so is
sufficient cause for the dismissal of this petition.

Moreover, although the instant petition is styled as a Petition for Certiorari, in


essence, it seeks the declaration by this Court of the unconstitutionality or
illegality of the questioned DAR AO No. 01-02, as amended, and Memorandum
No. 88. It, thus, partakes of the nature of a Petition for Declaratory Relief over
which this Court has only appellate, not original, jurisdiction.28 Section 5, Article
VIII of the 1987 Philippine Constitution provides:

Sec. 5. The Supreme Court shall have the following powers:

(1) Exercise original jurisdiction over cases affecting ambassadors, other


public ministers and consuls, and over petitions for certiorari, prohibition,
mandamus, quo warranto, and habeas corpus.

(2) Review, revise, reverse, modify, or affirm on appeal or certiorari as the


law or the Rules of Court may provide, final judgments and orders of lower
courts in:

(a) All cases in which the constitutionality or validity of any treaty,


international or executive agreement, law, presidential decree,
proclamation, order, instruction, ordinance, or regulation is in
question. (Emphasis supplied.)

With that, this Petition must necessarily fail because this Court does not have
original jurisdiction over a Petition for Declaratory Relief even if only questions of
law are involved.
Even if the petitioner has properly observed the doctrine of judicial hierarchy, this
Petition is still dismissible.

The special civil action for certiorari is intended for the correction of errors of
jurisdiction only or grave abuse of discretion amounting to lack or excess of
jurisdiction. Its principal office is only to keep the inferior court within the
parameters of its jurisdiction or to prevent it from committing such a grave abuse
of discretion amounting to lack or excess of jurisdiction.29

The essential requisites for a Petition for Certiorari under Rule 65 are: (1) the writ
is directed against a tribunal, a board, or an officer exercising judicial or quasi-
judicial functions; (2) such tribunal, board, or officer has acted without or in
excess of jurisdiction, or with grave abuse of discretion amounting to lack or
excess of jurisdiction; and (3) there is no appeal or any plain, speedy, and
adequate remedy in the ordinary course of law.30

Excess of jurisdiction as distinguished from absence of jurisdiction means that an


act, though within the general power of a tribunal, board or officer, is not
authorized and invalid with respect to the particular proceeding, because the
conditions which alone authorize the exercise of the general power in respect of
it are wanting.31 Without jurisdiction means lack or want of legal power, right or
authority to hear and determine a cause or causes, considered either in general
or with reference to a particular matter. It means lack of power to exercise
authority.32Grave abuse of discretion implies such capricious and whimsical
exercise of judgment as is equivalent to lack of jurisdiction or, in other words,
where the power is exercised in an arbitrary manner by reason of passion,
prejudice, or personal hostility, and it must be so patent or gross as to amount to
an evasion of a positive duty or to a virtual refusal to perform the duty enjoined or
to act at all in contemplation of law.33

In the case before this Court, the petitioner fails to meet the above-mentioned
requisites for the proper invocation of a Petition for Certiorari under Rule 65. The
Secretary of Agrarian Reform in issuing the assailed DAR AO No. 01-02, as
amended, as well as Memorandum No. 88 did so in accordance with his
mandate to implement the land use conversion provisions of Republic Act No.
6657. In the process, he neither acted in any judicial or quasi-judicial capacity nor
assumed unto himself any performance of judicial or quasi-judicial prerogative. A
Petition for Certiorari is a special civil action that may be invoked only against a
tribunal, board, or officer exercising judicial functions. Section 1, Rule 65 of the
1997 Revised Rules of Civil Procedure is explicit on this matter, viz.:

SECTION 1. Petition for certiorari. When any tribunal, board or officer


exercising judicial or quasi-judicial functions has acted without or in excess of its
or his jurisdiction, or with grave abuse of discretion amounting to lack or excess
of jurisdiction, and there is no appeal, nor any plain, speedy, and adequate
remedy in the ordinary course of law, a person aggrieved thereby may file a
verified petition in the proper court, alleging the facts with certainty and praying
that judgment must be rendered annulling or modifying the proceedings of such
tribunal, board or officer.
1avvphi1

A tribunal, board, or officer is said to be exercising judicial function where it has


the power to determine what the law is and what the legal rights of the parties
are, and then undertakes to determine these questions and adjudicate upon the
rights of the parties. Quasi-judicial function, on the other hand, is "a term which
applies to the actions, discretion, etc., of public administrative officers or bodies x
x x required to investigate facts or ascertain the existence of facts, hold hearings,
and draw conclusions from them as a basis for their official action and to exercise
discretion of a judicial nature."34

Before a tribunal, board, or officer may exercise judicial or quasi-judicial acts, it is


necessary that there be a law that gives rise to some specific rights of persons or
property under which adverse claims to such rights are made, and the
controversy ensuing therefrom is brought before a tribunal, board, or officer
clothed with power and authority to determine the law and adjudicate the
respective rights of the contending parties.35

The Secretary of Agrarian Reform does not fall within the ambit of a tribunal,
board, or officer exercising judicial or quasi-judicial functions. The issuance and
enforcement by the Secretary of Agrarian Reform of the questioned DAR AO No.
01-02, as amended, and Memorandum No. 88 were done in the exercise of his
quasi-legislative and administrative functions and not of judicial or quasi-judicial
functions. In issuing the aforesaid administrative issuances, the Secretary of
Agrarian Reform never made any adjudication of rights of the parties. As such, it
can never be said that the Secretary of Agrarian Reform had acted with grave
abuse of discretion amounting to lack or excess of jurisdiction in issuing and
enforcing DAR AO No. 01-02, as amended, and Memorandum No. 88 for he
never exercised any judicial or quasi-judicial functions but merely his quasi-
legislative and administrative functions.

Furthermore, as this Court has previously discussed, the instant petition in


essence seeks the declaration by this Court of the unconstitutionality or illegality
of the questioned DAR AO No. 01-02, as amended, and Memorandum No. 88.
Thus, the adequate and proper remedy for the petitioner therefor is to file a
Petition for Declaratory Relief, which this Court has only appellate and not
original jurisdiction. It is beyond the province of certiorari to declare the aforesaid
administrative issuances unconstitutional and illegal because certiorari is
confined only to the determination of the existence of grave abuse of discretion
amounting to lack or excess of jurisdiction. Petitioner cannot simply allege grave
abuse of discretion amounting to lack or excess of jurisdiction and then invoke
certiorari to declare the aforesaid administrative issuances unconstitutional and
illegal. Emphasis must be given to the fact that the writ of certiorari dealt with in
Rule 65 of the 1997 Revised Rules of Civil Procedure is a prerogative writ, never
demandable as a matter of right, "never issued except in the exercise of judicial
discretion."36

At any rate, even if the Court will set aside procedural infirmities, the instant
petition should still be dismissed.

Executive Order No. 129-A37 vested upon the DAR the responsibility of
implementing the CARP. Pursuant to the said mandate and to ensure the
successful implementation of the CARP, Section 5(c) of the said executive order
authorized the DAR to establish and promulgate operational policies, rules and
regulations and priorities for agrarian reform implementation. Section 4(k) thereof
authorized the DAR to approve or disapprove the conversion, restructuring or
readjustment of agricultural lands into non-agricultural uses. Similarly, Section
5(l) of the same executive order has given the DAR the exclusive authority to
approve or disapprove conversion of agricultural lands for residential,
commercial, industrial, and other land uses as may be provided for by law.
Section 7 of the aforesaid executive order clearly provides that "the authority and
responsibility for the exercise of the mandate of the [DAR] and the discharge of
its powers and functions shall be vested in the Secretary of Agrarian Reform x x
x."
Under DAR AO No. 01-02, as amended, "lands not reclassified as residential,
commercial, industrial or other non-agricultural uses before 15 June 1988" have
been included in the definition of agricultural lands. In so doing, the Secretary of
Agrarian Reform merely acted within the scope of his authority stated in the
aforesaid sections of Executive Order No. 129-A, which is to promulgate rules
and regulations for agrarian reform implementation and that includes the
authority to define agricultural lands for purposes of land use conversion. Further,
the definition of agricultural lands under DAR AO No. 01-02, as amended, merely
refers to the category of agricultural lands that may be the subject for conversion
to non-agricultural uses and is not in any way confined to agricultural lands in the
context of land redistribution as provided for under Republic Act No. 6657.

More so, Department of Justice Opinion No. 44, Series of 1990, which Opinion
has been recognized in many cases decided by this Court, clarified that after the
effectivity of Republic Act No. 6657 on 15 June 1988 the DAR has been given the
authority to approve land conversion.38 Concomitant to such authority, therefore,
is the authority to include in the definition of agricultural lands "lands not
reclassified as residential, commercial, industrial or other non-agricultural uses
before 15 June 1988" for purposes of land use conversion.

In the same vein, the authority of the Secretary of Agrarian Reform to include
"lands not reclassified as residential, commercial, industrial or other non-
agricultural uses before 15 June 1988" in the definition of agricultural lands finds
basis in jurisprudence. In Ros v. Department of Agrarian Reform,39 this Court has
enunciated that after the passage of Republic Act No. 6657, agricultural lands,
though reclassified, have to go through the process of conversion, jurisdiction
over which is vested in the DAR. However, agricultural lands, which are already
reclassified before the effectivity of Republic Act No. 6657 which is 15 June 1988,
are exempted from conversion.40 It bears stressing that the said date of effectivity
of Republic Act No. 6657 served as the cut-off period for automatic
reclassifications or rezoning of agricultural lands that no longer require any DAR
conversion clearance or authority.41It necessarily follows that any reclassification
made thereafter can be the subject of DARs conversion authority. Having
recognized the DARs conversion authority over lands reclassified after 15 June
1988, it can no longer be argued that the Secretary of Agrarian Reform was
wrongfully given the authority and power to include "lands not reclassified as
residential, commercial, industrial or other non-agricultural uses before 15 June
1988" in the definition of agricultural lands. Such inclusion does not unduly
expand or enlarge the definition of agricultural lands; instead, it made clear what
are the lands that can be the subject of DARs conversion authority, thus, serving
the very purpose of the land use conversion provisions of Republic Act No. 6657.

The argument of the petitioner that DAR AO No. 01-02, as amended, was made
in violation of Section 65 of Republic Act No. 6657, as it covers even those non-
awarded lands and reclassified lands by the LGUs or by way of Presidential
Proclamations on or after 15 June 1988 is specious. As explained in Department
of Justice Opinion No. 44, series of 1990, it is true that the DARs express power
over land use conversion provided for under Section 65 of Republic Act No. 6657
is limited to cases in which agricultural lands already awarded have, after five
years, ceased to be economically feasible and sound for agricultural purposes, or
the locality has become urbanized and the land will have a greater economic
value for residential, commercial or industrial purposes. To suggest, however,
that these are the only instances that the DAR can require conversion clearances
would open a loophole in Republic Act No. 6657 which every landowner may use
to evade compliance with the agrarian reform program. It should logically follow,
therefore, from the said departments express duty and function to execute and
enforce the said statute that any reclassification of a private land as a residential,
commercial or industrial property, on or after the effectivity of Republic Act No.
6657 on 15 June 1988 should first be cleared by the DAR.42

This Court held in Alarcon v. Court of Appeals43 that reclassification of lands does
not suffice. Conversion and reclassification differ from each other. Conversion is
the act of changing the current use of a piece of agricultural land into some other
use as approved by the DAR while reclassification is the act of specifying how
agricultural lands shall be utilized for non-agricultural uses such as residential,
industrial, and commercial, as embodied in the land use plan, subject to the
requirements and procedures for land use conversion. In view thereof, a mere
reclassification of an agricultural land does not automatically allow a landowner
to change its use. He has to undergo the process of conversion before he is
permitted to use the agricultural land for other purposes.44

It is clear from the aforesaid distinction between reclassification and conversion


that agricultural lands though reclassified to residential, commercial, industrial or
other non-agricultural uses must still undergo the process of conversion before
they can be used for the purpose to which they are intended.
Nevertheless, emphasis must be given to the fact that DARs conversion
authority can only be exercised after the effectivity of Republic Act No. 6657 on
15 June 1988.45 The said date served as the cut-off period for automatic
reclassification or rezoning of agricultural lands that no longer require any DAR
conversion clearance or authority.46Thereafter, reclassification of agricultural
lands is already subject to DARs conversion authority. Reclassification alone will
not suffice to use the agricultural lands for other purposes. Conversion is needed
to change the current use of reclassified agricultural lands.

It is of no moment whether the reclassification of agricultural lands to residential,


commercial, industrial or other non-agricultural uses was done by the LGUs or by
way of Presidential Proclamations because either way they must still undergo
conversion process. It bears stressing that the act of reclassifying agricultural
lands to non-agricultural uses simply specifies how agricultural lands shall be
utilized for non-agricultural uses and does not automatically convert agricultural
lands to non-agricultural uses or for other purposes. As explained in DAR
Memorandum Circular No. 7, Series of 1994, cited in the 2009 case of Roxas &
Company, Inc. v. DAMBA-NFSW and the Department of Agrarian
Reform,47 reclassification of lands denotes their allocation into some specific use
and providing for the manner of their utilization and disposition or the act of
specifying how agricultural lands shall be utilized for non-agricultural uses such
as residential, industrial, or commercial, as embodied in the land use plan. For
reclassified agricultural lands, therefore, to be used for the purpose to which they
are intended there is still a need to change the current use thereof through the
process of conversion. The authority to do so is vested in the DAR, which is
mandated to preserve and maintain agricultural lands with increased productivity.
Thus, notwithstanding the reclassification of agricultural lands to non-agricultural
uses, they must still undergo conversion before they can be used for other
purposes.

Even reclassification of agricultural lands by way of Presidential Proclamations to


non-agricultural uses, such as school sites, needs conversion clearance from the
DAR. We reiterate that reclassification is different from conversion.
Reclassification alone will not suffice and does not automatically allow the
landowner to change its use. It must still undergo conversion process before the
landowner can use such agricultural lands for such purpose.48Reclassification of
agricultural lands is one thing, conversion is another. Agricultural lands that are
reclassified to non-agricultural uses do not ipso facto allow the landowner thereof
to use the same for such purpose. Stated differently, despite having reclassified
into school sites, the landowner of such reclassified agricultural lands must apply
for conversion before the DAR in order to use the same for the said purpose.

Any reclassification, therefore, of agricultural lands to residential, commercial,


industrial or other non-agricultural uses either by the LGUs or by way of
Presidential Proclamations enacted on or after 15 June 1988 must undergo the
process of conversion, despite having undergone reclassification, before
agricultural lands may be used for other purposes.

It is different, however, when through Presidential Proclamations public


agricultural lands have been reserved in whole or in part for public use or
purpose, i.e., public school, etc., because in such a case, conversion is no longer
necessary. As held in Republic v. Estonilo,49 only a positive act of the President is
needed to segregate or reserve a piece of land of the public domain for a public
purpose. As such, reservation of public agricultural lands for public use or
purpose in effect converted the same to such use without undergoing any
conversion process and that they must be actually, directly and exclusively used
for such public purpose for which they have been reserved, otherwise, they will
be segregated from the reservations and transferred to the DAR for distribution to
qualified beneficiaries under the CARP.50 More so, public agricultural lands
already reserved for public use or purpose no longer form part of the alienable
and disposable lands of the public domain suitable for agriculture.51 Hence, they
are outside the coverage of the CARP and it logically follows that they are also
beyond the conversion authority of the DAR.

Clearly from the foregoing, the Secretary of Agrarian Reform did not act without
jurisdiction or in excess of jurisdiction or with grave abuse of discretion
amounting to lack or excess of jurisdiction in (1) including lands not reclassified
as residential, commercial, industrial or other non-agricultural uses before 15
June 1988 in the definition of agricultural lands under DAR AO No. 01-02, as
amended, and; (2) issuing and enforcing DAR AO No. 01-02, as amended,
subjecting to DARs jurisdiction for conversion lands which had already been
reclassified as residential, commercial, industrial or for other non-agricultural
uses on or after 15 June 1988.

Similarly, DAR AO No. 01-02, as amended, providing that the reclassification of


agricultural lands by LGUs shall be subject to the requirements of land use
conversion procedure or that DARs approval or clearance must be secured to
effect reclassification, did not violate the autonomy of the LGUs.

Section 20 of Republic Act No. 7160 states that:

SECTION 20. Reclassification of Lands. (a) A city or municipality may, through


an ordinance passed by the sanggunian after conducting public hearings for the
purpose, authorize the reclassification of agricultural lands and provide for the
manner of their utilization or disposition in the following cases: (1) when the land
ceases to be economically feasible and sound for agricultural purposes as
determined by the Department of Agriculture or (2) where the land shall have
substantially greater economic value for residential, commercial, or industrial
purposes, as determined by the sanggunian concerned: Provided, That such
reclassification shall be limited to the following percentage of the total agricultural
land area at the time of the passage of the ordinance:

xxxx

(3) For fourth to sixth class municipalities, five percent (5%): Provided, further,
That agricultural lands distributed to agrarian reform beneficiaries pursuant to
Republic Act Numbered Sixty-six hundred fifty-seven (R.A. No. 6657), otherwise
known as "The Comprehensive Agrarian Reform Law," shall not be affected by
the said reclassification and the conversion of such lands into other purposes
shall be governed by Section 65 of said Act.

xxxx

(e) Nothing in this Section shall be construed as repealing, amending, or


modifying in any manner the provisions of R.A. No. 6657.

The aforequoted provisions of law show that the power of the LGUs to reclassify
agricultural lands is not absolute. The authority of the DAR to approve conversion
of agricultural lands covered by Republic Act No. 6657 to non-agricultural uses
has been validly recognized by said Section 20 of Republic Act No. 7160 by
explicitly providing therein that, "nothing in this section shall be construed as
repealing or modifying in any manner the provisions of Republic Act No. 6657."

DAR AO No. 01-02, as amended, does not also violate the due process clause,
as well as the equal protection clause of the Constitution. In providing
administrative and criminal penalties in the said administrative order, the
Secretary of Agrarian Reform simply implements the provisions of Sections 73
and 74 of Republic Act No. 6657, thus:

Sec. 73. Prohibited Acts and Omissions. The following are prohibited:

xxxx

(c) The conversion by any landowner of his agricultural land into any non-
agricultural use with intent to avoid the application of this Act to his landholdings
and to disposes his tenant farmers of the land tilled by them;

xxxx

(f) The sale, transfer or conveyance by a beneficiary of the right to use or any
other usufructuary right over the land he acquired by virtue of being a beneficiary,
in order to circumvent the provisions of this Act.

xxxx

Sec. 74. Penalties. Any person who knowingly or willfully violates the
provisions of this Act shall be punished by imprisonment of not less than one (1)
month to not more than three (3) years or a fine of not less than one thousand
pesos (P1,000.00) and not more than fifteen thousand pesos (P15,000.00), or
both, at the discretion of the court.

If the offender is a corporation or association, the officer responsible therefor


shall be criminally liable.

And Section 11 of Republic Act No. 8435, which specifically provides:

Sec. 11. Penalty for Agricultural Inactivity and Premature Conversion. x x x.

Any person found guilty of premature or illegal conversion shall be penalized with
imprisonment of two (2) to six (6) years, or a fine equivalent to one hundred
percent (100%) of the government's investment cost, or both, at the discretion of
the court, and an accessory penalty of forfeiture of the land and any improvement
thereon.
In addition, the DAR may impose the following penalties, after determining, in an
administrative proceedings, that violation of this law has been committed:

a. Consolation or withdrawal of the authorization for land use conversion;


and

b. Blacklisting, or automatic disapproval of pending and subsequent


conversion applications that they may file with the DAR.

Contrary to petitioners assertions, the administrative and criminal penalties


provided for under DAR AO No. 01-02, as amended, are imposed upon the illegal
or premature conversion of lands within DARs jurisdiction, i.e., "lands not
reclassified as residential, commercial, industrial or for other non-agricultural
uses before 15 June 1998."

The petitioners argument that DAR Memorandum No. 88 is unconstitutional, as it


suspends the land use conversion without any basis, stands on hollow ground.

It bears emphasis that said Memorandum No. 88 was issued upon the instruction
of the President in order to address the unabated conversion of prime agricultural
lands for real estate development because of the worsening rice shortage in the
country at that time. Such measure was made in order to ensure that there are
enough agricultural lands in which rice cultivation and production may be carried
into. The issuance of said Memorandum No. 88 was made pursuant to the
general welfare of the public, thus, it cannot be argued that it was made without
any basis.

WHEREFORE, premises considered, the instant Petition for Certiorari is


DISMISSED. Costs against petitioner.

G.R. No. 132477 August 31, 2005

JOSE LUIS ROS, ANDONI F. ABOITIZ, XAVIER ABOITIZ, ROBERTO E.


ABOITIZ, ENRIQUE ABOITIZ, MATTHIAS G. MENDEZONA, CEBU
INDUSTRIAL PARK DEVELOPERS, INC. and FBM ABOITIZ MARINE,
INC., Petitioners,
vs.
DEPARTMENT OF AGRARIAN REFORM, HON. ERNESTO GARILAO, in his
capacity as DAR Secretary, and DIR. JOSE LLAMES, in his capacity as
Director of DAR-Regional 7, Respondent.

DECISION

CHICO-NAZARIO, J.:

Petitioners are the owners/developers of several parcels of land located in Arpili,


Balamban, Cebu. By virtue of Municipal Ordinance No. 101 passed by the
Municipal Council of Balamban, Cebu, these lands were reclassified as industrial
lands.1 On 03 April 1995, the Provincial Board of Cebu approved Balambans
land use plan and adopteden toto Balambans Municipal Ordinance No. 101 with
the passage of Resolution No. 836-95 and Provincial Ordinance No. 95-8,
respectively.2 As part of their preparation for the development of the subject lands
as an industrial park, petitioners secured all the necessary permits and
appropriate government certifications.3

Despite these permits and certifications, petitioner Matthias Mendezona received


a letter from Mr. Jose Llames, Director of the Department of Agrarian Reform
(DAR) Regional Office for Region 7, informing him that the DAR was disallowing
the conversion of the subject lands for industrial use and directed him to cease
and desist from further developments on the land to avoid the incurrence of civil
and criminal liabilities.4

Petitioners were thus constrained to file with the Regional Trial Court (RTC) of
Toledo City a Complaint dated 29 July 1996 for Injunction with Application for
Temporary Restraining Order and a Writ of Preliminary Injunction, docketed as
Civil Case No. T-590.5 In an order6 dated 12 August 1996, the RTC, ruling that it
is the DAR which has jurisdiction, dismissed the Complaint for lack of
jurisdiction.7 It justified the dismissal in this wise:

A perusal of Section 20 of the Local Government Code expressly provides that


the Municipalities through an Ordinance by the Sanggunian may authorize the
reclassification of the agricultural land within their area into non-agricultural.
Paragraph (e) of the aforesaid Section, provides further: that nothing in this
Section shall be construed as repealing or modifying in any manner the provision
of Republic Act 6657. In an opinion of the Secretary of Justice, quoted: With
respect of (sic) conversion of agricultural land to non-agricultural uses the
authority of the DAR to approve the same may be exercise (sic) only from the
date of the effectivity of the Agrarian Reform Law on June 15, 1988. It appears
that the petitioners had applied for conversion on June 13, 1995 and therefore
the petitioner (sic) are estopped from questioning the authority and jurisdiction of
the Department of Agrarian Reform. The application having been filed after June
15, 1988, the reclassification by the Municipal Council of Balamban was just a
step in the conversion of the aforestated lands according to its purpose.
Executive Order No. 129-A, Section 5, "The Department shall be responsible for
implementing Comprehensive Agrarian Reform and for such purpose it is
authorized to (J) approve or disapprove the conversion, restructuring or
readjustment of agricultural land into non-agricultural uses." Said Executive
Order amended Section 36 of Republic Act No. 3644 which clearly mandates that
the DAR Secretary (sic) approve or disapprove conversion are not impliedly
repealed. In fact, under Section 75 of Republic Act 6657 the above laws and
other laws not inconsistent of (sic) this act shall have suppletory effect. Further,
Section 68 of Republic Act 6657 provides: No injunction, restraining order,
prohibition or mandamus shall be issued by the lower court against the
Department of Agrarian Reform, DENR and Department of Justice in their
implementation of the program. With this provision, it is therefore clear (sic) when
there is conflict of laws determining whether the Department of Agrarian Reform
has been exclusively empowered by law to approve land conversion after June
15, 1988 and (sic) the final ruling falls only with the Supreme Court or Office of
the President.

WHEREFORE, in view of the foregoing, the Application for Restraining Order is


hereby ordered DENIED and the main case is DISMISSED, this Court having no
jurisdiction over the same.8

In an order dated 18 September 1996, the trial court denied the motion for
reconsideration filed by the petitioners.9Petitioners filed before this Court a
Petition for Review on Certiorari with application for Temporary Restraining Order
and Writ of Preliminary Injunction.10 In a resolution11 dated 11 November 1996,
this Court referred the petition to the Court of Appeals.12 Petitioners moved for a
reconsideration of the said resolution but the same was denied in a resolution
dated 27 January 1997.13

At the Court of Appeals, the public respondents were ordered14 to file their
Comments on the petition. Two sets of comments from the public respondents,
one from the Department of Agrarian Reform Provincial Office15 and another from
the Office of the Solicitor General,16 were submitted, to which petitioners filed
their Consolidated Reply.17

On 02 December 1997, the Court of Appeals rendered a decision18 affirming the


Order of Dismissal issued by the RTC.19 A motion for reconsideration filed by the
petitioners was denied in a resolution dated 30 January 1998.20

Hence, this petition.

The following issues21 are raised by the petitioners for resolution:

(a) Whether or not the reclassification of the subject lands to industrial use by the
Municipality of Balamban, Cebu pursuant to its authority under Section 20(a) of
Republic Act No. 7160 or the Local Government Code of 1991 (the "LGC") has
the effect of taking such lands out of the coverage of the CARL and beyond the
jurisdiction of the DAR;

(b) Whether or not the Complaint for Injunction may be dismissed under the
doctrine of primary jurisdiction;

(c) Whether or not the Complaint for Injunction is an appropriate remedy against
the order of the DAR enjoining development works on the subject lands;

(d) Whether or not the Regional Trial Court of Toledo City had authority to issue a
writ of injunction against the DAR.

In sum, petitioners are of the view that local governments have the power to
reclassify portions of their agricultural lands, subject to the conditions set forth in
Section 202223of the Local Government Code. According to them, if the agricultural
land sought to be reclassified by the local government is one which has already
been brought under the coverage of the Comprehensive Agrarian Reform Law
(CARL) and/or which has been distributed to agrarian reform beneficiaries, then
such reclassification must be confirmed by the DAR pursuant to its authority
under Section 6522 of the CARL, in order for the reclassification to become
effective. If, however, the land sought to be reclassified is not covered by the
CARL and not distributed to agrarian reform beneficiaries, then no confirmation
from the DAR is necessary in order for the reclassification to become effective as
such case would not fall within the DARs conversion authority. Stated otherwise,
Section 65 of the CARL does not, in all cases, grant the DAR absolute, sweeping
and all-encompassing power to approve or disapprove reclassifications or
conversions of all agricultural lands. Said section only grants the DAR exclusive
authority to approve or disapprove conversions of agricultural lands which have
already been brought under the coverage of the CARL and which have already
been distributed to farmer beneficiaries.

The petition lacks merit.

After the passage of Republic Act No. 6657, otherwise known as Comprehensive
Agrarian Reform Program, agricultural lands, though reclassified, have to go
through the process of conversion, jurisdiction over which is vested in the DAR.
However, agricultural lands already reclassified before the effectivity of Rep. Act
No. 6657 are exempted from conversion.

Department of Justice Opinion No. 44, Series of 1990, provides:

". . . True, the DARs express power over land use conversion is limited to cases
in which agricultural lands already awarded have, after five years, ceased to be
economically feasible and sound for agricultural purposes, or the locality has
become urbanized and the land will have a greater economic value for
residential, commercial or industrial purposes. But to suggest that these are the
only instances when the DAR can require conversion clearances would open a
loophole in R.A. No. 6657, which every landowner may use to evade compliance
with the agrarian reform program. Hence, it should logically follow from the said
departments express duty and function to execute and enforce the said statute
that any reclassification of a private land as a residential, commercial or industrial
property should first be cleared by the DAR."

The requirement that agricultural lands must go through the process of


conversion despite having undergone reclassification was underscored in the
case of Alarcon v. Court of Appeals,24 where it was held that reclassification of
land does not suffice:

In the case at bar, there is no final order of conversion. The subject landholding
was merely reclassified. Conversion is different from reclassification. Conversion
is the act of changing the current use of a piece of agricultural land into some
other use as approved by the Department of Agrarian Reform. Reclassification,
on the other hand, is the act of specifying how agricultural lands shall be utilized
for non-agricultural uses such as residential, industrial, commercial, as embodied
in the land use plan, subject to the requirements and procedure for land use
conversion. Accordingly, a mere reclassification of agricultural land does not
automatically allow a landowner to change its use and thus cause the ejectment
of the tenants. He has to undergo the process of conversion before he is
permitted to use the agricultural land for other purposes.

Rep. Act No. 6657 took effect on 15 June 1988. Municipal Ordinance No. 101 of
Balamban, Cebu, which reclassified the subject lands, was passed on 25 March
1992, and Provincial Ordinance No. 95-8 of the Provincial Board of Cebu, which
adopted Municipal Ordinance No. 101, was passed on 03 April 1995, long after
Rep. Act No. 6657 has taken effect. Section 4 of Rep. Act No. 6657 provides:

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.

...

(d) All private lands devoted to or suitable for agriculture regardless of the
agricultural products raised or that can be raised thereon.

To further clarify any doubt on its authority, the DAR issued Administrative Order
No. 12 dated October 1994 which reads:

Administrative Order No. 12

Series of 1994

SUBJECT: CONSOLIDATED AND REVISED RULES AND PROCEDURES


GOVERNING CONVERSION OF ARICULTURAL LANDS TO NON-
AGRICULTURAL USES

I. PREFATORY STATEMENT

The guiding principles on land use conversion is to preserve prime agricultural


lands. On the other hand, conversion of agricultural lands, when coinciding with
the objectives of the Comprehensive Agrarian Reform Law to promote social
justice, industrialization, and the optimum use of land as a national resource for
public welfare, shall be pursued in a speedy and judicious manner.

To rationalize these principles, and by virtue of Republic Act (R.A.) No. 3844, as
amended, Presidential Decree (P.D.) No. 27, P.D. No. 946, Executive Order
(E.O.) No. 129-A and R.A. No. 6657, the Department of Agrarian Reform (DAR)
has issued several policy guidelines to regulate land use conversion. This
Administrative Order consolidates and revises all existing implementing
guidelines issued by the DAR, taking into consideration, other Presidential
issuances and national policies related to land use conversion.

II. LEGAL MANDATE

A. The Department of Agrarian Reform (DAR) is mandated to "approve or


disapprove applications for conversion, restructuring or readjustment of
agricultural lands into non-agricultural uses," pursuant to Section 4(i) of Executive
Order No. 129-A, Series of 1987.

B. Section 5(i) of E.O. No. 129-A, Series of 1987, vests in the DAR, exclusive
authority to approve or disapprove applications for conversion of agricultural
lands for residential, commercial, industrial, and other land uses.

C. Section 65 of R.A. No. 6657, otherwise known as the Comprehensive Agrarian


Reform Law of 1988, likewise empowers the DAR to authorize under certain
conditions, the reclassification or conversion of agricultural lands.

D. Section 4 of Memorandum Circular No. 54, Series of 1993 of the Office of the
President, provides that "action on applications for land use conversion on
individual landholdings shall remain as the responsibility of the DAR, which shall
utilize as its primary reference, documents on the comprehensive land use plans
and accompanying ordinances passed upon and approved by the local
government units concerned, together with the National Land Use Policy,
pursuant to R.A. No. 6657 and E.O. No. 129-A."

III. DEFINITION OF TERMS

A. Agricultural land refers to land devoted to agricultural activity and not classified
as mineral, forest, residential, commercial or industrial land (Section 3[c], R.A.
No. 6657).
B. Conversion is the act of changing the current use of a piece of agricultural
land into some other use.

C. Reclassification of agricultural lands is the act of specifying how agricultural


lands shall be utilized for non-agricultural uses such as residential, industrial,
commercial, as embodied in the land use plan. It also includes the reversion of
non-agricultural lands to agricultural use.

...

V. COVERAGE

These rules shall cover all private agricultural lands as defined herein regardless
of tenurial arrangement and commodity produced. It shall also include
agricultural lands reclassified by LGUs into non-agricultural uses, after June 15,
1988, pursuant to Memorandum Circular (M.C.) No. 54, Series of 1993 of the
Office of the President and those proposed to be used for livestock, poultry and
swine raising as provided in DAR Administrative Order No. 9, Series of 1993.

In the case of Advincula-Velasquez v. Court of Appeals,25 we held:

Our ruling in the Natalia case was reiterated in National Housing Authority v.
Allarde (318 SCRA 22 [1999]).

The Court of Appeals reliance on DOJ Opinion No. 44, Series of 1990, is in
order. In the said opinion, the Secretary of Justice declared, viz:

Based on the foregoing premises, we reiterate the view that with respect to
conversions of agricultural lands covered by R.A. No. 6657 to non-agricultural
uses, the authority of DAR to approve such conversions may be exercised from
the date of the laws effectivity on June 15, 1988. This conclusion is based on a
liberal interpretation of R.A. No. 6657 in the light of DARs mandate and
extensive coverage of the agrarian reform program.

Following the DOJ opinion, the DAR issued Administrative Order No. 6, Series of
1994, stating that lands already classified as non-agricultural before the
enactment of Rep. Act No. 6657 no longer needed any conversion clearance:

I. Prefatory Statement
In order to streamline the issuance of exemption clearances, based on DOJ
Opinion No. 44, the following guidelines are being issued for the guidance of the
DAR and the public in general.

II. Legal Basis

Sec. 3(c) of RA 6657 states that agricultural lands refers to the land devoted to
agricultural activity as defined in this act and not classified as mineral, forest,
residential, commercial or industrial land.

Department of Justice Opinion No. 44, series of 1990 has ruled that, with respect
to the conversion of agricultural lands covered by RA No. 6657 to non-agricultural
uses, the authority of DAR to approve such conversion may be exercised from
the date of its effectivity, on June 15, 1988. Thus, all lands that are already
classified as commercial, industrial, or residential before 15 June 1988 no longer
need any conversion clearance.

The authority of the DAR to approve conversions of agricultural lands covered by


Rep. Act No. 6657 to non-agricultural uses has not been pierced by the passage
of the Local Government Code. The Code explicitly provides26 that "nothing in this
section shall be construed as repealing or modifying in any manner the
provisions of Rep. Act No. 6657."

It being settled that jurisdiction over conversion of land is vested in the DAR, the
complaint for injunction was correctly dismissed by the trial and appellate courts
under the doctrine of primary jurisdiction. This Court, in Bautista v. Mag-isa Vda.
De Villena,27 found occasion to reiterate the doctrine of primary jurisdiction

The doctrine of primary jurisdiction precludes the courts from resolving a


controversy over which jurisdiction has initially been lodged with an
administrative body of special competence. For agrarian reform cases,
jurisdiction is vested in the Department of Agrarian Reform (DAR); more
specifically, in the Department of Agrarian Reform Adjudication Board (DARAB).

Executive Order 229 vested the DAR with (1) quasi-judicial powers to determine
and adjudicate agrarian reform matters; and (2) jurisdiction over all matters
involving the implementation of agrarian reform, except those falling under the
exclusive original jurisdiction of the Department of Agriculture and the
Department of Environment and Natural Resources. This law divested the
regional trial courts of their general jurisdiction to try agrarian reform matters.

Under Republic Act 6657, the DAR retains jurisdiction over all agrarian reform
matters. The pertinent provision reads:

"Section 50. Quasi-Judicial Powers of the DAR. The DAR is hereby vested with
the 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 and the Department of Environment
and Natural Resources.

"It shall not be bound by technical rules of procedure and evidence but shall
proceed to hear and decide all cases, disputes or controversies in a most
expeditious manner, employing all reasonable means to ascertain the facts of
every case in accordance with justice and equity and the merits of the case.
Toward this end, it shall adopt a uniform rule of procedure to achieve a just,
expeditious and inexpensive determination of every action or proceeding before
it. . . ."

Finally, the third and fourth issues which may be summed up into whether or not
an injunction is the appropriate remedy against the order of the DAR enjoining
petitioners in developing the subject land, we rule in the negative. Section 68 of
Rep. Act No. 6657 provides:

SEC. 68. Immunity of Government Agencies from Undue Interference. No


injunction, restraining order, prohibition or mandamus shall be issued by the
lower courts against the Department of Agrarian Reform (DAR), the Department
of Agriculture (DA), the Department of Environment and Natural Resources
(DENR), and the Department of Justice (DOJ) in their implementation of the
program.

Wherefore, premises considered, the instant petition is Denied for lack of merit.
The decision of the Court of Appeals in CA-G.R. SP No. 42666 dated 02
December 1997 affirming the order dated 12 August 1996 of the Regional Trial
Court of Toledo City, Branch 29, in Civil Case No. T-590 is AFFIRMED. Costs
against petitioners.
SO ORDERED.

G.R. No. 152085 July 8, 2003

MARCIANA ALARCON, ERENCIO AUSTRIA, JUAN BONIFACIO, PETRONILA


DELA CRUZ, RUFINA DELA CRUZ, CELESTINO LEGASPI, JOSE
MAYONDAG and DAVID SANTOS, petitioners,
vs.
HONORABLE COURT OF APPEALS and PASCUAL AND SANTOS,
INC., respondents.

YNARES-SANTIAGO, J.:

Before us is a petition for review on certiorari seeking to set aside the decision
dated September 28, 2001 of the Court of Appeals in CA-G.R. SP No.
63680,1 which reversed the decision dated January 10, 2001 of the Department
of Agrarian Reform Adjudication Board (DARAB).

The facts are undisputed.

Respondent corporation, Pascual and Santos, Inc., is the owner of several


saltbeds with an area of 4.1763 hectares, situated in Barangay San Dionisio,
Manuyo, Paraaque. In 1950, it instituted petitioners as tenants of the saltbeds
under a fifty-fifty share tenancy agreement.

The harmonious tenurial relationship between petitioners and private respondent


was interrupted in 1994, when the city government of Paraaque, represented by
then Mayor Pablo Olivares, authorized the dumping of garbage on the adjoining
lot. The garbage polluted the main source of salt water, which adversely affected
salt production on the subject landholding.

Petitioners informed respondent of this development, but it failed to take any step
to stop the dumping of garbage on the adjoining lot. This prompted petitioners to
file a formal protest with the City Government of Paraaque. However, their
complaint was likewise ignored.

Thus petitioners were constrained to file with the Regional Agrarian Reform
Adjudicator of Region IV (RARAD-IV) a complaint against respondent and Mayor
Pablo Olivares for maintenance of peaceful possession and security of tenure
with damages. Subsequently, they amended their complaint to one for damages
and disturbance compensation, with prayer for temporary restraining order and
injunction. Petitioners invoked Sections 7,2 30(1)3and 31(1)4 of Republic Act No.
3844, as amended, otherwise known as the Agricultural Land Reform Code of
the Philippines.

On July 28, 1997, Regional Adjudicator Fe Arche-Manalang rendered a decision


holding that under Metro Manila Zoning Ordinance No. 81-01, issued in 1981, the
subject saltbeds have been reclassified to residential lands. Consequently, the
juridical tie between petitioners and respondent was severed, for no tenurial
relationship can exist on a land that is no longer agricultural. This
notwithstanding, petitioners are entitled to disturbance compensation, pursuant to
Section 36, par. 1 of R.A. 3844,5 as amended.

On the other hand, the Regional Adjudicator held that the DAR had no jurisdiction
over the complaint against Mayor Pablo Olivares, and dismissed the same. The
dispositive portion of the decision reads:

WHEREFORE, premises considered, judgment is hereby rendered:

1. Directing the Respondent Pascual and Santos Inc., to pay to each


complainant as and by way of disturbance compensation 1,500 cavans of
salt or their money equivalent at the prevailing market value;

2. Dismissing all other claims for lack of basis;

3. Without pronouncement as to costs.

SO ORDERED.6

On appeal, the DARAB affirmed in toto the above decision of the RARAD.
Aggrieved, respondent filed a petition for review with the Court of Appeals, which
was docketed as CA-G.R. SP No. 63680. On September 28, 2001, the appellate
court rendered the assailed judgment reversing the decision of the DARAB,7 and
ordering the dismissal of petitioners complaint against respondent. Petitioners
motion for reconsideration was denied.

Hence, the instant petition based on the following arguments:


I. THAT A LANDOWNER IS NOT LIABLE TO PAY DISTURBANCE
COMPENSATION TO A TENANT ON A MERE RECLASSIFICATION
WITHOUT THE ACTIVE PARTICIPATION OF THE LANDOWNER
BECAUSE IT WOULD RENDER NUGATORY SECTION 31, PAR. 1 OF
RA 3844.

II. THAT METRO MANILA ZONING ORDINANCE NO. 81-01, SERIES OF


1981, DID NOT EXTINGUISH THE TENURIAL RELATIONSHIP OF
LANDLORD AND TENANT AND RECLASSIFICATION OF THE LAND
DOES NOT ENTITLE THE TENANTS TO DISTURBANCE
COMPENSATION FOR PARTIES CAN CONTINUE WITH THEIR
TENURIAL RELATIONS EVEN AFTER RECLASSIFICATION.8

At the core of the controversy is the issue of whether or not a mere


reclassification of the land from agricultural to residential, without any court action
by the landowner to eject or dispossess the tenant, entitles the latter to
disturbance compensation.

Before we address the above issue, we need to resolve a procedural issue


raised by private respondent regarding the law that must govern the instant case.
Is it Republic Act No. 1199, otherwise known as the Agricultural Tenancy Act of
the Philippines, which allows a share tenancy system for landlord-tenant
relationship, or RA 3844, as amended, which declares share tenancy as contrary
to public policy and provides for the automatic conversion of landlord-tenant
relationship from agricultural share tenancy to agricultural leasehold?
Respondent contends that RA 1199 must govern the instant petition because
Section 35 of RA 3844 clearly exempts the saltbeds from leasehold and provides
that the provisions of RA 1199 shall govern the consideration as well as the
tenancy system prevailing on saltbeds. The said provision reads:

Section 35. Notwithstanding the provisions of the preceding Sections, in the case
of fishponds, saltbeds, and land principally planted to citrus, coconuts, cacao,
coffee, durian, and other similar permanent trees at the time of the approval of
this Code, the consideration as well as the tenancy system prevailing, shall be
governed by the provisions of Republic Act Number Eleven Hundred and Ninety-
Nine, as amended.
We do not agree. Section 76 of Republic Act No. 6657, or the Comprehensive
Agrarian Reform Law,9 expressly repealed Section 35 of RA 3844. It therefore
abolished the exemption applied to saltbeds and provided that all tenanted
agricultural lands shall be subject to leasehold. Consequently, RA 3844, not RA
1199, must govern the instant petition.

Coming now to the main issue, petitioners argue that they are entitled to
disturbance compensation for being dispossessed of their tenancy.

Respondent counters that under Sections 3010 and 31(1)11 of RA 3844, a


landowner of agricultural land is liable to pay disturbance compensation only
when he petitioned the court to eject or dispossess the tenant on the ground that
the land has already been reclassified from agricultural to non-agricultural.
Without such a petition, he has no obligation to pay disturbance compensation
because the mere reclassification of the land does not ipso facto extinguish the
tenancy relationship between tenant and landowner. Hence, when the subject
landholding was reclassified in 1981 by the enactment of Metro Manila Zoning
Ordinance No. 81-01, petitioners and private respondent continued with their
tenancy relationship. It was only in 1994 that their relationship was disturbed due
to the dumping of garbage by the city government which polluted the source of
saltwater.

The petition is devoid of merit.

A tenancy relationship, once established, entitles the tenant to a security of


tenure.12 He can only be ejected from the agricultural landholding on grounds
provided by law. This is clearly stated in Section 7 of RA 3844, which provides:

SEC. 7. Tenure of Agricultural Leasehold Relation. The agricultural


leasehold relation once established shall confer upon the agricultural
lessee the right to continue working on the landholding until such leasehold
relation is extinguished. The agricultural lessee shall be entitled to security
of tenure on his landholding and cannot be ejected therefrom unless
authorized by the Court for causes herein provided.

Section 36 provides the different grounds and manner by which a tenant can be
lawfully ejected or dispossessed of his landholding. One of them is the
reclassification of the landholding from agricultural to non-agricultural. For
purposes of this petition, the pertinent provision of said Section 36 reads:
SEC. 36. Possession of Landholding; Exceptions. Notwithstanding any
agreement as to the period or future surrender of the land, an agricultural
lessee shall continue in the enjoyment and possession of his landholding
except when his dispossession has been authorized by the Court in a
judgment that is final and executory if after due hearing it is shown that:

1. The landholding is declared by the department head upon


recommendation of the National Planning Commission to be suited for
residential, commercial, industrial or some other urban purposes:
Provided, That the agricultural lessee shall be entitled to disturbance
compensation equivalent to five times the average of the gross harvests on
his landholding during the last five preceding calendar years; x x x.

It is clear that a tenant can be lawfully ejected only if there is a court authorization
in a judgment that is final and executory and after a hearing where the
reclassification of the landholding was duly determined. If the court authorizes
the ejectment, the tenant who is dispossessed of his tenancy is entitled to
disturbance compensation.

Petitioners argue that the RARAD decision, which was affirmed by the DARAB,
was the court judgment required by law.

The argument is not well-taken. The RARAD decision is not yet final and
executory. It was made the subject of a petition for review with the Court of
Appeals and is pending with this Court.

Petitioners likewise contend that the dispossession of the tenant need not be at
the instance of the landowner for him to be entitled to disturbance compensation.

The contention is without merit.

Section 3713 of RA 3844 expressly imposes on the landowner or agricultural


lessor the burden of proof to show the existence of the grounds enumerated in
Section 36 thereof. It is settled that one who alleges a fact has the burden of
proving it.14 This implies that the action which resulted in the tenants
dispossession was commenced by the landowner, who therefore has the burden
of proof to show the existence of any of the grounds for the ejectment of the
tenant.
Moreover, contrary to petitioners claim, the reclassification of the land is not
enough to entitle them to disturbance compensation. The law is clear that court
proceedings are indispensable where the reclassification of the landholding is
duly determined before ejectment can be effected, which in turn paves the way
for the payment of disturbance compensation. As held by the Court of Appeals,
the parties can still continue with their tenurial relationship even after such
reclassification. In fact, it is undisputed that in this case, the parties continued
with their landlord-tenant relationship even after the enactment of Metro Manila
Zoning Ordinance No. 81-01. It was only in 1994 when this relationship was
interrupted because of the dumping of garbage by the Paraaque City
Government. Clearly, it was this latter event which caused petitioners
dispossession, and it would be unfair to oblige respondent to pay compensation
for acts it did not commit.

Finally, the case of Bunye v. Aquino,15 does not apply in the instant case. We
allowed the payment of disturbance compensation in the said case because
there was an order of conversion issued by the Department of Agrarian Reform
of the landholding from agricultural to residential. The decree was never
questioned and thus became final. Consequently, the tenants were ejected from
the land and were thus awarded disturbance compensation.

In the case at bar, there is no final order of conversion. The subject landholding
was merely reclassified. Conversion is different from reclassification. Conversion
is the act of changing the current use of a piece of agricultural land into some
other use as approved by the Department of Agrarian Reform.16 Reclassification,
on the other hand, is the act of specifying how agricultural lands shall be utilized
for non-agricultural uses such as residential, industrial, commercial, as embodied
in the land use plan, subject to the requirements and procedure for land use
conversion.17 Accordingly, a mere reclassification of agricultural land does not
automatically allow a landowner to change its use and thus cause the ejectment
of the tenants. He has to undergo the process of conversion before he is
permitted to use the agricultural land for other purposes.

Since in this case, there is neither a final order of conversion by the DAR nor a
court judgment authorizing the tenants ejectment on the ground of
reclassification, as a result of the landowners court action, there is no legal basis
to make respondent liable to pay disturbance compensation. Accordingly, the
Court of Appeals committed no error in ordering the dismissal of the complaint
before the DARAB.

WHEREFORE, in view of the foregoing disquisitions, the instant petition for


review is DENIED and the decision dated September 28, 2001 of the Court of
Appeals in CA-G.R. SP No. 63680, ordering the dismissal of DARAB Case No.
6408 (Reg. Case No. IV-MM-0083-94), is AFFIRMED.

SO ORDERED.

G.R. No. 103125 May 17, 1993

PROVINCE OF CAMARINES SUR, represented by GOV. LUIS R.


VILLAFUERTE and HON. BENJAMIN V. PANGA as Presiding Judge of RTC
Branch 33 at Pili, Camarines Sur, petitioners,
vs.
THE COURT OF APPEALS (THIRD DIVISION), ERNESTO SAN JOAQUIN and
EFREN SAN JOAQUIN,respondents.

The Provincial Attorney for petitioners.

Reynaldo L. Herrera for Ernesto San Joaquin.

QUIASON, J.:

In this appeal by certiorari from the decision of the Court of Appeals in AC-G.R.
SP No. 20551 entitled "Ernesto N. San Joaquin, et al., v. Hon. Benjamin V.
Panga, et al.," this Court is asked to decide whether the expropriation of
agricultural lands by local government units is subject, to the prior approval of the
Secretary of the Agrarian Reform, as the implementator of the agrarian reform
program.

On December 22, 1988, the Sangguniang Panlalawigan of the Province of


Camarines Sur passed Resolution No. 129, Series of 1988, authorizing the
Provincial Governor to purchase or expropriate property contiguous to the
provincial capitol site, in order to establish a pilot farm for non-food and non-
traditional agricultural crops and a housing project for provincial government
employees.

The "WHEREAS" clause o:f the Resolution states:

WHEREAS, the province of Camarines Sur has adopted a five-year


Comprehensive Development plan, some of the vital components of
which includes the establishment of model and pilot farm for non-
food and non-traditional agricultural crops, soil testing and tissue
culture laboratory centers, 15 small scale technology soap making,
small scale products of plaster of paris, marine biological and sea
farming research center,and other progressive feasibility concepts
objective of which is to provide the necessary scientific and
technology know-how to farmers and fishermen in Camarines Sur
and to establish a housing project for provincial government
employees;

WHEREAS, the province would need additional land to be acquired


either by purchase or expropriation to implement the above program
component;

WHEREAS, there are contiguous/adjacent properties to be (sic)


present Provincial Capitol Site ideally suitable to establish the same
pilot development center;

WHEREFORE . . . .

Pursuant to the Resolution, the Province of Camarines Sur, through its Governor,
Hon. Luis R.Villafuerte, filed two separate cases for expropriation against Ernesto
N. San Joaquin and Efren N. San Joaquin, docketed as Special Civil Action Nos.
P-17-89 and P-19-89 of the Regional Trial Court, Pili, Camarines Sur, presided
by the Hon. Benjamin V. Panga.

Forthwith, the Province of Camarines Sur filed a motion for the issuance of writ of
possession. The San Joaquins failed to appear at the hearing of the motion.

The San Joaquins moved to dismiss the complaints on the ground of inadequacy
of the price offered for their property. In an order dated December 6, 1989, the
trial court denied the motion to dismiss and authorized the Province of
Camarines Sur to take possession of the property upon the deposit with the Clerk
of Court of the amount of P5,714.00, the amount provisionally fixed by the trial
court to answer for damages that private respondents may suffer in the event
that the expropriation cases do not prosper. The trial court issued a writ of
possession in an order dated January18, 1990.

The San Joaquins filed a motion for relief from the order, authorizing the Province
of Camarines Sur to take possession of their property and a motion to admit an
amended motion to dismiss. Both motions were denied in the order dated
February 1990.

In their petition before the Court of Appeals, the San Joaquins asked: (a) that
Resolution No. 129, Series of 1988 of the Sangguniang Panlalawigan be
declared null and void; (b) that the complaints for expropriation be dismissed;
and (c) that the order dated December 6, 1989 (i) denying the motion to dismiss
and (ii) allowing the Province of Camarines Sur to take possession of the
property subject of the expropriation and the order dated February 26, 1990,
denying the motion to admit the amended motion to dismiss, be set aside. They
also asked that an order be issued to restrain the trial court from enforcing the
writ of possession, and thereafter to issue a writ of injunction.

In its answer to the petition, the Province of Camarines Sur claimed that it has
the authority to initiate the expropriation proceedings under Sections 4 and 7 of
Local Government Code (B.P. Blg. 337) and that the expropriations are for a
public purpose.

Asked by the Court of Appeals to give his Comment to the petition, the Solicitor
General stated that under Section 9 of the Local Government Code (B.P. Blg.
337), there was no need for the approval by the Office of the President of the
exercise by the Sangguniang Panlalawigan of the right of eminent domain.
However, the Solicitor General expressed the view that the Province of
Camarines Sur must first secure the approval of the Department of Agrarian
Reform of the plan to expropriate the lands of petitioners for use as a housing
project.

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

Hence this petition.

It must be noted that in the Court of Appeals, the San Joaquins asked for: (i) the
dismissal of the complaints for expropriation on the ground of the inadequacy of
the compensation offered for the property and (ii) the nullification of Resolution
No. 129, Series of 1988 of the Sangguniang Panlalawigan of the Province of
Camarines Sur.

The Court of Appeals did not rule on the validity of the questioned resolution;
neither did it dismiss the complaints. However, when the Court of Appeals
ordered the suspension of the proceedings until the Province of Camarines Sur
shall have obtained the authority of the Department of Agrarian Reform to
change the classification of the lands sought to be expropriated from agricultural
to non-agricultural use, it assumed that the resolution is valid and that the
expropriation is for a public purpose or public use.

Modernly, there has been a shift from the literal to a broader interpretation of
"public purpose" or "public use" for which the power of eminent domain may be
exercised. The old concept was that the condemned property must actually be
used by the general public (e.g. roads, bridges, public plazas, etc.) before the
taking thereof could satisfy the constitutional requirement of "public use". Under
the new concept, "public use" means public advantage, convenience or benefit,
which tends to contribute to the general welfare and the prosperity of the whole
community, like a resort complex for tourists or housing project (Heirs of Juancho
Ardano v. Reyes, 125 SCRA 220 [1983]; Sumulong v. Guerrero, 154 SC.RA 461
[1987]).

The expropriation of the property authorized by the questioned resolution is for a


public purpose. The establishment of a pilot development center would inure to
the direct benefit and advantage of the people of the Province of Camarines Sur.
Once operational, the center would make available to the community invaluable
information and technology on agriculture, fishery and the cottage industry.
Ultimately, the livelihood of the farmers, fishermen and craftsmen would be
enhanced. The housing project also satisfies the public purpose requirement of
the Constitution. As held in Sumulong v. Guerrero, 154 SCRA 461, "Housing is a
basic human need. Shortage in housing is a matter of state concern since it
directly and significantly affects public health, safety, the environment and in sum
the general welfare."

It is the submission of the Province of Camarines Sur that its exercise of the
power of eminent domain cannot be restricted by the provisions of the
Comprehensive Agrarian Reform Law (R.A. No. 6657), particularly Section 65
thereof, which requires the approval of the Department of Agrarian Reform before
a parcel of land can be reclassified from an agricultural to a non-agricultural land.

The Court of Appeals, following the recommendation of the Solicitor General,


held that the Province of Camarines Sur must comply with the provision of
Section 65 of the Comprehensive Agrarian Reform Law and must first secure the
approval of the Department of Agrarian Reform of the plan to expropriate the
lands of the San Joaquins.

In Heirs of Juancho Ardana v. Reyes, 125 SCRA 220, petitioners raised the issue
of whether the Philippine Tourism Authority can expropriate lands covered by the
"Operation Land Transfer" for use of a tourist resort complex. There was a finding
that of the 282 hectares sought to be expropriated, only an area of 8,970 square
meters or less than one hectare was affected by the land reform program and
covered by emancipation patents issued by the Ministry of Agrarian Reform.
While the Court said that there was "no need under the facts of this petition to
rule on whether the public purpose is superior or inferior to another purpose or
engage in a balancing of competing public interest," it upheld the expropriation
after noting that petitioners had failed to overcome the showing that the taking of
8,970 square meters formed part of the resort complex. A fair and reasonable
reading of the decision is that this Court viewed the power of expropriation as
superior to the power to distribute lands under the land reform program.

The Solicitor General denigrated the power to expropriate by the Province of


Camarines Sur by stressing the fact that local government units exercise such
power only by delegation. (Comment, pp. 14-15; Rollo, pp. 128-129)

It is true that local government units have no inherent power of eminent domain
and can exercise it only when expressly authorized by the legislature (City of
Cincinnati v. Vester, 28l US 439, 74 L.ed. 950, 50 SCt. 360). It is also true that in
delegating the power to expropriate, the legislature may retain certain control or
impose certain restraints on the exercise thereof by the local governments (Joslin
Mfg. Co. v. Providence, 262 US 668 67 L. ed. 1167, 43 S Ct. 684). While such
delegated power may be a limited authority, it is complete within its limits.
Moreover, the limitations on the exercise of the delegated power must be clearly
expressed, either in the law conferring the power or in other legislations.

Resolution No. 129, Series of 1988, was promulgated pursuant to Section 9 of


B.P. Blg. 337, the Local Government Code, which provides:

A local government unit may, through its head and acting pursuant to
a resolution of its sanggunian exercise the right of eminent domain
and institute condemnation proceedings for public use or purpose.

Section 9 of B.P. Blg. 337 does not intimate in the least that local government,
units must first secure the approval of the Department of Land Reform for the
conversion of lands from agricultural to non-agricultural use, before they can
institute the necessary expropriation proceedings. Likewise, there is no provision
in the Comprehensive Agrarian Reform Law which expressly subjects the
expropriation of agricultural lands by local government units to the control of the
Department of Agrarian Reform. The closest provision of law that the Court of
Appeals could cite to justify the intervention of the Department of Agrarian
Reform in expropriation matters is Section 65 of the Comprehensive Agrarian
Reform Law, which reads:

Sec. 65. Conversion of Lands. After the lapse of five (5) years
from its award, when the land ceases to be economically feasible
and sound for, agricultural purposes, or the locality has become
urbanized and the land will have a greater economic value for
residential, commercial or industrial purposes, the DAR, upon
application of the beneficiary or the landowner, with due notice to the
affected parties, and subject to existing laws, may authorize the
reclassification or conversion of the land and its
disposition:Provided, That the beneficiary shall have fully paid his
obligation.
The opening, adverbial phrase of the provision sends signals that it applies to
lands previously placed under the agrarian reform program as it speaks of "the
lapse of five (5) years from its award."

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

Statutes conferring the power of eminent domain to political subdivisions cannot


be broadened or constricted by implication (Schulman v. People, 10 N.Y. 2d. 249,
176 N.E. 2d. 817, 219 NYS 2d. 241).

To sustain the Court of Appeals would mean that the local government units can
no longer expropriate agricultural lands needed for the construction of roads,
bridges, schools, hospitals, etc, without first applying for conversion of the use of
the lands with the Department of Agrarian Reform, because all of these projects
would naturally involve a change in the land use. In effect, it would then be the
Department of Agrarian Reform to scrutinize whether the expropriation is for a
public purpose or public use.

Ordinarily, it is the legislative branch of the local government unit that shall
determine whether the use of the property sought to be expropriated shall be
public, the same being an expression of legislative policy. The courts defer to
such legislative determination and will intervene only when a particular
undertaking has no real or substantial relation to the public use (United States Ex
Rel Tennessee Valley Authority v. Welch, 327 US 546, 90 L. ed. 843, 66 S Ct
715; State ex rel Twin City Bldg. and Invest. Co. v. Houghton, 144 Minn. 1, 174
NW 885, 8 ALR 585).

There is also an ancient rule that restrictive statutes, no matter how broad their
terms are, do not embrace the sovereign unless the sovereign is specially
mentioned as subject thereto (Alliance of Government Workers v. Minister of
Labor and Employment, 124 SCRA 1 [1983]). The Republic of the Philippines, as
sovereign, or its political subdivisions, as holders of delegated sovereign powers,
cannot be bound by provisions of law couched in general term.

The fears of private respondents that they will be paid on the basis of the
valuation declared in the tax declarations of their property, are unfounded. This
Court has declared as unconstitutional the Presidential Decrees fixing the just
compensation in expropriation cases to be the value given to the condemned
property either by the owners or the assessor, whichever was lower ([Export
Processing Zone Authority v. Dulay, 149 SCRA 305 [1987]). As held
inMunicipality of Talisay v. Ramirez, 183 SCRA 528 [1990], the rules for
determining just compensation are those laid down in Rule 67 of the Rules of
Court, which allow private respondents to submit evidence on what they consider
shall be the just compensation for their property.

WHEREFORE, the petition is GRANTED and the questioned decision of the


Court of Appeals is set aside insofar as it (a) nullifies the trial court's order
allowing the Province of Camarines Sur to take possession of private
respondents' property; (b) orders the trial court to suspend the expropriation
proceedings; and (c) requires the Province of Camarines Sur to obtain the
approval of the Department of Agrarian Reform to convert or reclassify private
respondents' property from agricultural to non-agricultural use.

The decision of the Court of Appeals is AFFIRMED insofar as it sets aside the
order of the trial court, denying the amended motion to dismiss of the private
respondents.

SO ORDERED.

G.R. No. 131457 April 24, 1998

HON. CARLOS O. FORTICH, PROVINCIAL GOVERNOR OF BUKIDNON,


HON. REY B. BAULA, MUNICIPAL MAYOR OF SUMILAO, BUKIDNON, NQSR
MANAGEMENT AND DEVELOPMENT CORPORATION,petitioners,
vs.
HON. RENATO C. CORONA, DEPUTY EXECUTIVE SECRETARY, HON.
ERNESTO D. GARILAO, SECRETARY OF THE DEPARTMENT OF AGRARIAN
REFORM, respondents.
MARTINEZ, J.:

The dramatic and well-publicized hunger strike staged by some alleged farmer-
beneficiaries in front of the Department of Agrarian Reform compound in Quezon
City on October 9, 1997 commanded nationwide attention that even church
leaders and some presidential candidates tried to intervene for the strikers'
"cause."

The strikers protested the March 29, 1996 Decision 1 of the Office of the President (OP), issued
through then Executive Secretary Ruben D. Torres in OP Case No. 96-C-6424, which approved the conversion of a one hundred forty-four
(144)-hectare land from agricultural to agro-industrial/institutional area. This led the Office of the President, through then Deputy Executive
2
Secretary Renato C. Corona, to issue the so-called "Win-Win" Resolution on November 7, 1997, substantially modifying its earlier Decision
after it had already become final and executory. The said Resolution modified the approval of the land conversion to agro-industrial area only
to the extent of forty-four (44) hectares, and ordered the remaining one hundred (100) hectares to be distributed to qualified farmer-
beneficiaries.

But, did the "Win-Win" Resolution culminate in victory for all the contending
parties?

The above-named petitioners cried foul. They have come to this Court urging us
to annul and set aside the "Win-Win" Resolution and to enjoin respondent
Secretary Ernesto D. Garilao of the Department of Agrarian Reform from
implementing the said Resolution.

Thus, the crucial issue to be resolved in this case is: What is the legal effect of
the "Win-Win" Resolution issued by the Office of the President on its earlier
Decision involving the same subject matter, which had already become final and
executory?

The antecedent facts of this controversy, as culled from the pleadings, may be
stated as follows:

1. This case involves a 144-hectare land located at San Vicente, Sumilao,


Bukidnon, owned by the Norberto Quisumbing, Sr. Management and
Development Corporation (NQSRMDC), one of the petitioners. The property is
covered by a Transfer Certificate of Title No. 14371 3 of the Registry of Deeds of the Province of
Bukidnon.

2. In 1984, the land was leased as a pineapple plantation to the Philippine


Packing Corporation, now Del Monte Philippines, Inc. (DMPI), a multinational
corporation, for a period of ten (10) years under the Crop Producer and Grower's
Agreement duly annotated in the certificate of title. The lease expired in April,
1994.

3. In October, 1991, during the existence of the lease, the Department of


Agrarian Reform (DAR) placed the entire 144-hectare property under compulsory
acquisition and assessed the land value at P2.38 million. 4

4. NQSRMDC resisted the DAR's action. In February, 1992, it sought and was
granted by the DAR Adjudication Board (DARAB), through its Provincial Agrarian
Reform Adjudicator (PARAD) in DARAB Case No. X-576, a writ of prohibition
with preliminary injunction which ordered the DAR Region X Director, the
Provincial Agrarian Reform Officer (PARO) of Bukidnon, the Municipal Agrarian
Reform Office (MARO) of Sumilao, Bukidnon, the Land Bank of the Philippines
(Land Bank), and their authorized representatives "to desist from pursuing any
activity or activities" concerning the subject land "until further orders." 5

5. Despite the DARAB order of March 31, 1992, the DAR Regional Director
issued a memorandum, dated May 21, 1992, directing the Land Bank to open a
trust account for P2.38 million in the name of NQSRMDC and to conduct
summary proceedings to determine the just compensation of the subject
property. NQSRMDC objected to these moves and filed on June 9, 1992 an
Omnibus Motion to enforce the DARAB order of March 31, 1992 and to nullify the
summary proceedings undertaken by the DAR Regional Director and Land Bank
on the valuation of the subject property.

6. The DARAB, on October 22, 1992, acted favorably on the Omnibus Motion by
(a) ordering the DAR Regional Director and Land Bank "to seriously comply with
the terms of the order dated March 31, 1992;" (b) nullifying the DAR Regional
Director's memorandum, dated May 21, 1992, and the summary proceedings
conducted pursuant thereto; and (c) directing the Land Bank "to return the claim
folder of Petitioner NQSRMDC's subject Property to the DAR until further
orders." 6

7. The Land Bank complied with the DARAB order and cancelled the trust
account it opened in the name of petitioner NQSRMDC. 7

8. In the meantime, the Provincial Development Council (PDC) of Bukidnon,


headed by Governor Carlos O. Fortich, passed Resolution No. 6, 8 dated January 7, 1993,
designating certain areas along Bukidnon-Sayre Highway as part of the Bukidnon Agro-Industrial Zones where the subject property is
situated.

9. What happened thereafter is well-narrated in the OP (TORRES) Decision of


March 29, 1996, pertinent portions of which we quote:

Pursuant to Section 20 of R.A. No. 7160, otherwise known as the


Local Government Code, the Sangguniang Bayan of Sumilao,
Bukidnon, on March 4, 1993, enacted Ordinance No. 24 converting
or re-classifying 144 hectares of land in Bgy. San Vicente, said
Municipality, from agricultural to industrial/institutional with a view of
providing an opportunity to attract investors who can inject new
economic vitality, provide more jobs and raise the income of its
people.

Parenthetically, under said section, 4th to 5th class municipalities


may authorize the classification of five percent (5%) of their
agricultural land area and provide for the manner of their utilization
or disposition.

On 12 October 1993, the Bukidnon Provincial Land Use Committee


approved the said Ordinance. Accordingly, on 11 December 1993,
the instant application for conversion was filed by Mr. Gaudencio
Beduya in behalf of NQSRMDC/BAIDA (Bukidnon Agro-Industrial
Development Association).

Expressing support for the proposed project, the Bukidnon Provincial


Board, on the basis of a Joint Committee Report submitted by its
Committee on Laws, Committee on Agrarian Reform and Socio-
Economic Committee approved, on 1 February 1994, the said
Ordinance now docketed as Resolution No. 94-95. The said
industrial area, as conceived by NQSRMDC (project proponent) is
supposed to have the following components:

1. Development Academy of Mindanao which constitutes following:


Institute for Continuing Higher Education; Institute for Livelihood
Science (Vocational and Technical School); Institute for Agribusiness
Research; Museum, Library, Cultural Center, and Mindanao Sports
Development Complex which covers an area of 24 hectares;
2. Bukidnon Agro-Industrial Park which consists of corn processing
for corn oil, corn starch, various corn products; rice processing for
wine, rice-based snacks, exportable rice; cassava processing for
starch, alcohol and food delicacies; processing plants, fruits and fruit
products such as juices; processing plants for vegetables processed
and prepared for market; cold storage and ice plant; cannery
system; commercial stores; public market; and abattoir needing
about 67 hectares;

3. Forest development which includes open spaces and parks for


recreation, horse-back riding, memorial and mini-zoo estimated to
cover 33 hectares; and

4. Support facilities which comprise the construction of a 360-room


hotel, restaurants, dormitories and a housing project covering an
area of 20 hectares.

The said NQSRMDC Proposal was, per Certification dated January


4, 1995, adopted by the Department of Trade and Industry, Bukidnon
Provincial Office, as one of its flagship projects. The same was
likewise favorably recommended by the Provincial Development
Council of Bukidnon; the municipal, provincial and regional office of
the DAR; the Regional Office (Region X) of the DENR (which issued
an Environmental Compliance Certificate on June 5, 1995); the
Executive Director, signing "By Authority of PAUL G. DOMINGUEZ,"
Office of the President Mindanao; the Secretary of DILG; and
Undersecretary of DECS Wilfredo D. Clemente.

In the same vein, the National Irrigation Administration, Provincial


Irrigation Office, Bagontaas Valencia, Bukidnon, thru Mr. Julius S.
Maquiling, Chief, Provincial Irrigation Office, interposed NO.
OBJECTION to the proposed conversion "as long as the
development cost of the irrigation systems thereat which is
P2,377.00 per hectare be replenished by the developer . . . ." Also,
the Kisolon-San Vicente Irrigators Multi Purpose Cooperative, San
Vicente, Sumilao, Bukidnon, interposed no objection to the proposed
conversion of the land in question "as it will provide more economic
benefits to the community in terms of outside investments that will
come and employment opportunities that will be generated by the
projects to be put up . . . .

On the same score, it is represented that during the public


consultation held at the Kisolan Elementary School on 18 March
1995 with Director Jose Macalindong of DAR Central Office and
DECS Undersecretary Clemente, the people of the affected
barangay rallied behind their respective officials in endorsing the
project.

Notwithstanding the foregoing favorable recommendation, however,


on November 14, 1994, the DAR, thru Secretary Garilao, invoking its
powers to approve conversion of lands under Section 65 of R.A. No.
6657, issued an Order denying the instant application for the
conversion of the subject land from agricultural to agro-industrial
and, instead, placed the same under the compulsory coverage of
CARP and directed the distribution thereof to all qualified
beneficiaries on the following grounds:

1. The area is considered as a prime agricultural land with irrigation


facility;

2. The land has long been covered by a Notice of Compulsory


Acquisition (NCA);

3. The existing policy on withdrawal or lifting on areas covered by


NCA is not applicable;

4. There is no clear and tangible compensation package


arrangements for the beneficiaries;

5. The procedures on how the area was identified and reclassified


for agro-industrial project has no reference to Memo Circular No. 54,
Series of 1993, E.O. No. 72, Series of 1993, and E.O. No. 124,
Series of 1993.

A Motion for Reconsideration of the aforesaid Order was filed on


January 9, 1995 by applicant but the same was denied (in an Order
dated June 7, 1995). 9
10. Thus, the DAR Secretary ordered the DAR Regional Director "to proceed with
the compulsory acquisition and distribution of the property." 10

11. Governor Carlos O. Fortich of Bukidnon appealed" the order of denial to the
Office of the President and prayed for the conversion/reclassification of the
subject land as the same would be more beneficial to the people of Bukidnon.

12. To prevent the enforcement of the DAR Secretary's order, NQSRMDC, on


June 29, 1995, filed with the Court of Appeals a petition for certiorari, prohibition
with preliminary injunction, 12 docketed as CA-G.R. SP No. 37614.

13. Meanwhile, on July 25, 1995, the Honorable Paul G. Dominguez, then
Presidential Assistant for Mindanao, after conducting an evaluation of the
proposed project, sent a memorandum 13 to the President favorably endorsing the project with a
recommendation that the DAR Secretary reconsider his decision in denying the application of the province for the conversion of the land.

14. Also, in a memorandum 14 to the President dated August 23, 1995, the Honorable Rafael Alunan III, then Secretary
of the Department of the Interior and Local Government (DILG), recommended the conversion of the subject land to industrial/institutional
use with a request that the President "hold the implementation of the DAR order to distribute the land in question."

15. On October 23, 1995, the Court of Appeals, in CA-G.R. SP No. 37614, issued
a Resolution 15 ordering the parties to observe status quo pending resolution of the petition. At the hearing held in said case on
October 5, 1995, the DAR, through the Solicitor General, manifested before the said court that the DAR was merely "in the processing stage
16
of the applications of farmers-claimants" and has agreed to respect status quo pending the resolution of the petition.

16. In resolving the appeal, the Office of the President, through then Executive
Secretary Ruben D. Torres, issued a Decision in OP Case No. 96-C-6424, dated
March 29, 1996, reversing the DAR Secretary's decision, the pertinent portions of
which read:

After a careful evaluation of the petition vis-a-vis the grounds upon


which the denial thereof by Secretary Garilao was based, we find
that the instant application for conversion by the Municipality of
Sumilao, Bukidnon is impressed with merit. To be sure, converting
the land in question from agricultural to agro-industrial would open
great opportunities for employment and bring about real
development in the area towards a sustained economic growth of
the municipality. On the other hand, distributing the land to would-be
beneficiaries (who are not even tenants, as there are none) does not
guarantee such benefits.
Nevertheless, on the issue that the land is considered a prime
agricultural land with irrigation facility it maybe appropriate to
mention that, as claimed by petitioner, while it is true that there is,
indeed, an irrigation facility in the area, the same merely passes thru
the property (as a right of way) to provide water to the ricelands
located on the lower portion thereof. The land itself, subject of the
instant petition, is not irrigated as the same was, for several years,
planted with pineapple by the Philippine Packing Corporation.

On the issue that the land has long been covered by a Notice of
Compulsory Acquisition (NCA) and that the existing policy on
withdrawal or lifting on areas covered by NCA is not applicable,
suffice it to state that the said NCA was declared null and void by the
Department of Agrarian Reform Adjudication Board (DARAB) as
early as March 1, 1992. Deciding in favor of NQSRMDC, the DARAB
correctly pointed out that under Section 8 of R.A. No. 6657, the
subject property could not validly be the subject of compulsory
acquisition until after the expiration of the lease contract with Del
Monte Philippines, a Multi-National Company, or until April 1994, and
ordered the DAR Regional Office and the Land Bank of the
Philippines, both in Butuan City, to "desist from pursuing any activity
or activities covering petitioner's land.

On this score, we take special notice of the fact that the Quisumbing
family has already contributed substantially to the land reform
program of the government, as follows: 300 hectares of rice land in
Nueva Ecija in the 70's and another 400 hectares in the nearby
Municipality of Impasugong, Bukidnon, ten(10) years ago, for which
they have not received "just compensation" up to this time.

Neither can the assertion that "there is no clear and tangible


compensation package arrangements for the beneficiaries' hold
water as, in the first place, there are no beneficiaries to speak about,
for the land is not tenanted as already stated.

Nor can procedural lapses in the manner of identifying/reclassifying


the subject property for agro-industrial purposes be allowed to
defeat the very purpose of the law granting autonomy to local
government units in the management of their local affairs. Stated
more simply, the language of Section 20 of R.A. No. 7160, supra, is
clear and affords no room for any other interpretation. By
unequivocal legal mandate, it grants local government units
autonomy in their local affairs including the power to convert portions
of their agricultural lands and provide for the manner of their
utilization and disposition to enable them to attain their fullest
development as self-reliant communities.

WHEREFORE, in pursuance of the spirit and intent of the said legal


mandate and in view of the favorable recommendations of the
various government agencies abovementioned, the subject Order,
dated November 14, 1994 of the Hon. Secretary, Department of
Agrarian Reform, is hereby SET ASIDE and the instant application of
NQSRMDC/BAIDA is hereby APPROVED. 17

17. On May 20, 1996, DAR filed a motion for reconsideration of the OP decision.

18. On September 11, 1996, in compliance with the OP decision of March 29,
1996, NQSRMDC and the Department of Education, Culture and Sports (DECS)
executed a Memorandum of Agreement whereby the former donated four (4)
hectares from the subject land to DECS for the establishment of the NQSR High
School. 18

When NQSRMDC was about to transfer the title over the 4-hectare donated to
DECS, it discovered that the title over the subject property was no longer in its
name. It soon found out that during the pendency of both the Petition
for Certiorari, Prohibition, with Preliminary Injunction it filed against DAR in the
Court of Appeals and the appeal to the President filed by Governor Carlos O.
Fortich, the DAR, without giving just compensation, caused the cancellation of
NQSRMDC's title on August 11, 1995 and had it transferred in the name of the
Republic of the Philippines under TCT No. T-50264 19 of the Registry of Deeds of Bukidnon.
Thereafter, on September 25, 1995, DAR caused the issuance of Certificates of Land Ownership Award (CLOA) No. 00240227 and had it
20
registered in the name of 137 farmer-beneficiaries under TCT No. AT-3536 of the Registry of Deeds of Bukidnon.

19. Thus, on April 10, 1997, NQSRMDC filed a complaint 21 with the Regional Trial Court (RTC) of
Malaybalay, Bukidnon (Branch 9), docketed as Civil Case No. 2687-97, for annulment and cancellation of title, damages and injunction
22
against DAR and 141 others. The RTC then issued a Temporary Restraining Order on April 30, 1997 and a Writ of Preliminary Injunction
23
on May 19, 1997, restraining the DAR and 141 others from entering, occupying and/or wresting from NQSRMDC the possession of the
subject land.
20. Meanwhile, on June 23, 1997, an Order 24 was issued by then Executive Secretary Ruben D. Torres
denying DAR's motion for reconsideration for having been filed beyond the reglementary period of fifteen (15) days. The said order further
declared that the March 29, 1996 OP decision had already become final and executory.

21. The DAR filed on July 11, 1997 a second motion for reconsideration of the
June 23, 1997 Order of the President.

22. On August 12, 1997, the said writ of preliminary injunction issued by the RTC
was challenged by some alleged farmers before the Court of Appeals through a
petition for certiorari and prohibition, docketed as CA-G.R. SP No. 44905,
praying for the lifting of the injunction and for the issuance of a writ of prohibition
from further trying the RTC case.

23. On October 9, 1997, some alleged farmer-beneficiaries began their hunger


strike in front of the DAR Compound in Quezon City to protest the OP Decision of
March 29, 1996. On October 10, 1997, some persons claiming to be farmer-
beneficiaries of the NQSRMDC property filed a motion for intervention (styled as
Memorandum In Intervention) in O.P. Case No. 96-C-6424, asking that the OP
Decision allowing the conversion of the entire 144-hectare property be set
aside. 25

24. President Fidel V. Ramos then held a dialogue with the strikers and promised
to resolve their grievance within the framework of the law. He created an eight
(8)-man Fact Finding Task Force (FFTF) chaired by Agriculture Secretary
Salvador Escudero to look into the controversy and recommend possible
solutions to the problem. 26

25. On November 7, 1997, the Office of the President resolved the strikers'
protest by issuing the so-called "Win/Win" Resolution penned by then Deputy
Executive Secretary Renato C. Corona, the dispositive portion of which reads:

WHEREFORE, premises considered, the decision of the Office of


the President, through Executive Secretary Ruben Torres, dated
March 29, 1996, is hereby MODIFIED as follows:

1. NQSRMDC's application for conversion is APPROVED only with


respect to the approximately forty-four (44) hectare portion of the
land adjacent to the highway, as recommended by the Department
of Agriculture.
2. The remaining approximately one hundred (100) hectares
traversed by an irrigation canal and found to be suitable for
agriculture shall be distributed to qualified farmer-beneficiaries in
accordance with RA 6657 or the Comprehensive Agrarian Reform
Law with a right of way to said portion from the highway provided in
the portion fronting the highway. For this purpose, the DAR and
other concerned government agencies are directed to immediately
conduct the segregation survey of the area, valuation of the property
and generation of titles in the name of the identified farmer-
beneficiaries.

3. The Department of Agrarian Reform is hereby directed to carefully


and meticulously determine who among the claimants are qualified
farmer-beneficiaries.

4. The Department of Agrarian Reform is hereby further directed to


expedite payment of just compensation to NQSRMDC for the portion
of the land to be covered by the CARP, including other lands
previously surrendered by NQSRMDC for CARP coverage.

5. The Philippine National Police is hereby directed to render full


assistance to the Department of Agrarian Reform in the
implementation of this Order.

We take note of the Memorandum in Intervention filed by 113


farmers on October 10, 1997 without ruling on the propriety or merits
thereof since it is unnecessary to pass upon it at this time.

SO ORDERED. 27

A copy of the "Win-Win" Resolution was received by Governor Carlos O. Fortich


of Bukidnon, Mayor Rey B. Baula of Sumilao, Bukidnon, and NQSRMDC on
November 24, 1997 28 and, on December 4, 1997, they filed the present petition for certiorari, prohibition (under Rule 65 of
the Revised Rules of Court) and injunction with urgent prayer for a temporary restraining order and/or writ of preliminary injunction (under
Rule 58, ibid.), against then Deputy Executive Secretary Renato C. Corona and DAR Secretary Ernesto D. Garilao.

On December 12, 1997, a Motion For Leave To Intervene 29 was filed by alleged farmer-
beneficiaries, through counsel, claiming that they are real parties in interest as they were "previously identified by respondent DAR as
30
agrarian reform beneficiaries on the 144-hectare" property subject of this case. The motion was vehemently opposed by the petitioners.
In seeking the nullification of the "Win-Win" Resolution, the petitioners claim that
the Office of the President was prompted to issue the said resolution "after a very
well-managed hunger strike led by fake farmer-beneficiary Linda Ligmon
succeeded in pressuring and/or politically blackmailing the Office of the President
to come up with this purely political decision to appease the 'farmers,' by reviving
and modifying the Decision of 29 March 1996 which has been declared final and
executory in an Order of 23 June 1997. . . ." 31 Thus, petitioners further allege, respondent then Deputy
Executive Secretary Renato C. Corona "committed grave abuse of discretion and acted beyond his jurisdiction when he issued the
32
questioned Resolution of 7 November 1997. . . ." They availed of this extraordinary writ of certiorari "because there is no other plain,
33
speedy and adequate remedy in the ordinary course of law." They never filed a motion for reconsideration of the subject Resolution
34
"because (it) is patently illegal or contrary to law and it would be a futile exercise to seek a reconsideration. . . ."

The respondents, through the Solicitor General, opposed the petition and prayed
that it be dismissed outright on the following grounds:

(1) The proper remedy of petitioners should have been to file a petition for review
directly with the Court of Appeals in accordance with Rule 43 of the Revised
Rules of Court;

(2) The petitioners failed to file a motion for reconsideration of the assailed "Win-
Win" Resolution before filing the present petition; and

(3) Petitioner NQSRMDC is guilty of forum-shopping.

These are the preliminary issues which must first be resolved, including the
incident on the motion for intervention filed by the alleged farmer-beneficiaries.

Anent the first issue, in order to determine whether the recourse of petitioners is
proper or not, it is necessary to draw a line between an error of judgment and an
error of jurisdiction. An error of judgment is one which the court may commit in
the exercise of its jurisdiction, and which error is reviewable only by an
appeal. 35 On the other hand, an error of jurisdiction is one where the act complained of was issued by the court, officer or a quasi-
judicial body without or in excess of jurisdiction, or with grave abuse of discretion which is tantamount to lack or in excess of
36 37
jurisdiction. This error is correctable only by the extraordinary writ of certiorari.

It is true that under Rule 43, appeals from awards, judgments, final orders or
resolutions of any quasi-judicial agency exercising quasi-judicial
functions, 38 including the Office of the President, 39 may be taken to the Court of Appeals by filing a verified petition for
40 41
review within fifteen (15) days from notice of the said judgment, final order or resolution, whether the appeal involves questions of fact,
42
of law, or mixed questions of fact and law.
However, we hold that, in this particular case, the remedy prescribed in Rule 43
is inapplicable considering that the present petition contains an allegation that the
challenged resolution is "patently illegal" 43 and was issued with "grave abuse of discretion" and "beyond his
44
(respondent Secretary Renato C. Corona's) jurisdiction" when said resolution substantially modified the earlier OP Decision of March 29,
1996 which had long become final and executory. In other words, the crucial issue raised here involves an error of jurisdiction, not an error of
judgment which is reviewable by an appeal under Rule 43. Thus, the appropriate remedy to annul and set aside the assailed resolution is an
original special civil action for certiorariunder Rule 65, as what the petitioners have correctly done. The pertinent portion of Section 1 thereof
provides:

Sec. 1. Petition for certiorari. When any tribunal, board or officer


exercising judicial or quasi-judicial functions has acted without or in
excess of its or his jurisdiction, or with grave abuse of discretion
amounting to lack or excess of jurisdiction, and there is no appeal, or
any plain, speedy, and adequate remedy in the ordinary course of
law, a person aggrieved thereby may file a verified petition in the
proper court, alleging the facts with certainty and praying that
judgment be rendered annulling or modifying the proceedings of
such tribunal, board or officer, and granting such incidental reliefs as
law and justice may require.

xxx xxx xxx

The office of a writ of certiorari is restricted to truly extraordinary cases


cases in which the act of the lower court or quasi-judicial body is wholly
void. 45

The aforequoted Section 1 of Rule 65 mandates that the person aggrieved by the
assailed illegal act "may file a verified petition (for certiorari) in the proper court."
The proper court where the petition must be filed is stated in Section 4 of the
same Rule 65 which reads:

Sec. 4. Where petition filed. The petition may be filed not later
than sixty (60) days from notice of the judgment, order or resolution
sought to be assailed in the Supreme Court or, if it relates to the acts
or omissions of a lower court or of a corporation, board, officer or
person, in the Regional Trial Court exercising jurisdiction over the
territorial area as defined by the Supreme Court. It may also be filed
in the Court of Appeals whether or not the same is in aid of its
appellate jurisdiction, or in the Sandiganbayan if it is in aid of its
jurisdiction. If it involves the acts or omissions of a quasi-judicial
agency, and unless otherwise provided by law or these Rules, the
petition shall be filed in and cognizable only by the Court of Appeals.
(4a)

Under the above-qouted Section 4, the Supreme Court, Court of Appeals and
Regional Trial Court have original concurrent jurisdiction to issue a writ
of certiorari, 46 prohibition 47 and mandamus. 48 But the jurisdiction of these three (3) courts are also delineated in that, if the
challenged act relates to acts or omissions of a lower court or of a corporation, board, officer or person, the petition must be filed with the
Regional Trial Court which exercises jurisdiction over the territorial area as defined by the Supreme Court. And if it involves the act or
omission of a quasi-judicial agency, the petition shall be filed only with the Court of Appeals, unless otherwise provided by law or the Rules of
49
Court. We have clearly discussed this matter of concurrence of jurisdiction in People vs. Cuaresma, et. al., through now Chief Justice
Andres R. Narvasa, thus:

. . . . This Court's original jurisdiction to issue writs of certiorari (as


well as prohibition, mandamus, quo warranto, habeas corpus and
injunction) is not exclusive. It is shared by this Court with Regional
Trial Courts (formerly Courts of First Instance), which may issue the
writ, enforceable in any part of their respective regions. It is also
shared by this Court, and by the Regional Trial Court, with the Court
of Appeals (formerly, Intermediate Appellate Court), although prior to
the effectivity of Batas Pambansa Bilang 129 on August 14, 1981,
the latter's competence to issue the extraordinary writs was
restricted to those "in aid of its appellate jurisdiction." This
concurrence of jurisdiction is not, however, to be taken as according
to parties seeking any of the writs an absolute, unrestrained freedom
of choice of the court to which application therefor will be directed.
There is after all a hierarchy of courts. That hierarchy is
determinative of the venue of appeals, and should also serve as a
general determinant of the appropriate forum for petitions for the
extraordinary writs. A becoming regard for that judicial hierarchy
most certainly indicates that petitions for the issuance of
extraordinary writs against first level ("inferior") courts should be filed
with the Regional Trial Court, and those against the latter, with the
Court of Appeals. (Citations omitted)

But the Supreme Court has the full discretionary power to take cognizance of the
petition filed directly to it if compelling reasons, or the nature and importance of
the issues raised, warrant. This has been the judicial policy to be observed and
which has been reiterated in subsequent cases, namely: 50 Uy vs. Contreras, et. al., 51 Torres
52 53 54
vs. Arranz, Bercero vs. De Guzman, and Advincula vs. Legaspi, et. al. As we have further stated in Cuaresma:
. . . . A direct invocation of the Supreme Court's original jurisdiction to
issue these writs should be allowed only when there are special and
important reasons therefor, clearly and specifically set out in the
petition. This is established policy. It is a policy that is necessary to
prevent inordinate demands upon the Court's time and attention
which are better devoted to those matters within its exclusive
jurisdiction, and to prevent further over-crowding of the Court's
docket.

Pursuant to said judicial policy, we resolve to take primary jurisdiction over the
present petition in the interest of speedy justice 55 and to avoid future litigations so as to promptly put an
end to the present controversy which, as correctly observed by petitioners, has sparked national interest because of the magnitude of the
problem created by the issuance of the assailed resolution. Moreover, as will be discussed later, we find the assailed resolution wholly void
and requiring the petitioners to file their petition first with the Court of Appeals would only result in a waste of time and money.

That the Court has the power to set aside its own rules in the higher interests of
justice is well-entrenched, in our jurisprudence. We reiterate what we said
in Piczon vs. Court of Appeals: 56

Be it remembered that rules of procedure are but mere tools


designed to facilitate the attainment of justice. Their strict and rigid
application, which would result in technicalities that tend to frustrate
rather than promote substantial justice, must always be avoided.
Time and again, this Court has suspended its own rules and
excepted a particular case from their operation whenever the higher
interests of justice so require. In the instant petition, we forego a
lengthy disquisition of the proper procedure that should have been
taken by the parties involved and proceed directly to the merits of
the case.

As to the second issue of whether the petitioners committed a fatal procedural


lapse when they failed to file a motion for reconsideration of the assailed
resolution before seeking judicial recourse, suffice it to state that the said motion
is not necessary when the questioned resolution is a patent nullity, 57 as will be taken up
later.

With respect to the third issue, the respondents claim that the filing by the
petitioners of: (a) a petition for certiorari, prohibition with preliminary injunction
(CA-G.R. SP No. 37614) with the Court of Appeals; (b) a complaint for annulment
and cancellation of title, damages and injunction against DAR and 141 others
(Civil Case No. 2687-97) with the Regional Trial Court of Malaybalay, Bukidnon;
and (c) the present petition, constitute forum shopping.

We disagree.

The rule is that:

There is forum-shopping whenever, as a result of an adverse opinion


in one forum, a party seeks a favorable opinion (other than by
appeal or certiorari) in another. The principle applies not only with
respect to suits filed in the courts but also in connection with
litigation commenced in the courts while an administrative
proceeding is pending, as in this case, in order to defeat
administrative processes and in anticipation of an unfavorable
administrative ruling and a favorable court ruling. This specially so,
as in this case, where the court in which the second suit was
brought, has no jurisdiction (citations omitted).

The test for determining whether a party violated the rule against
forum shopping has been laid down in the 1986 case of Buan
vs. Lopez (145 SCRA 34), . . . and that is, forum shopping exists
where the elements of litis pendentia are present or where a final
judgment in one case will amount to res judicata in the other, as
follows:

There thus exists between the action before this Court


and RTC Case No. 86-36563 identity of parties, or at
least such parties as represent the same interests in
both actions, as well as identity of rights asserted and
relief prayed for, the relief being founded on the same
facts, and the identity on the two preceding particulars is
such that any judgment rendered in the other action,
will, regardless of which party is successful, amount
to res adjudicata in the action under consideration: all
the requisites, in fine, of auter action pendant. 58

It is clear from the above-quoted rule that the petitioners are not guilty of forum
shopping. The test for determining whether a party has violated the rule against
forum shopping is where a final judgment in one case will amount tores
adjudicata in the action under consideration. A cursory examination of the cases
filed by the petitioners does not show that the said cases are similar with each
other. The petition for certiorari in the Court of Appeals sought the nullification of
the DAR Secretary's order to proceed with the compulsory acquisition and
distribution of the subject property. On the other hand, the civil case in RTC of
Malaybalay, Bukidnon for the annulment and cancellation of title issued in the
name of the Republic of the Philippines, with damages, was based on the
following grounds: (1) the DAR, in applying for cancellation of petitioner
NQSRMDC's title, used documents which were earlier declared null and void by
the DARAB; (2) the cancellation of NQSRMDC's title was made without payment
of just compensation; and (3) without notice to NQSRMDC for the surrender of its
title. The present petition is entirely different from the said two cases as it seeks
the nullification of the assailed "Win-Win" Resolution of the Office of the
President dated November 7, 1997, which resolution was issued long after the
previous two cases were instituted.

The fourth and final preliminary issue to be resolved is the motion for intervention
filed by alleged farmer-beneficiaries, which we have to deny for lack of merit. In
their motion, movants contend that they are the farmer-beneficiaries of the land
in question, hence, are real parties in interest. To prove this, they attached as
Annex "I" in their motion a Master List of Farmer-Beneficiaries. Apparently, the
alleged master list was made pursuant to the directive in the dispositive portion of
the assailed "Win-Win" Resolution which directs the DAR "to carefully and
meticulously determine who among the claimants are qualified farmer-
beneficiaries." However, a perusal of the said document reveals that movants are
those purportedly "Found Qualified and Recommended for Approval." In other
words, movants are merely recommendee farmer-beneficiaries.

The rule in this jurisdiction is that a real party in interest is a party who would be
benefited or injured by the judgment or is the party entitled to the avails of the
suit. Real interest means a present substantial interest, as distinguished from a
mere expectancy or a future, contingent, subordinate or consequential
interest. 59 Undoubtedly, movants' interest over the land in question is a mere expectancy. Ergo, they are not real parties in interest.

Furthermore, the challenged resolution upon which movants based their motion
is, as intimated earlier, null and void. Hence, their motion for intervention has no
leg to stand on.
Now to the main issue of whether the final and executory Decision dated March
29, 1996 can still be substantially modified by the "Win-Win" Resolution.

We rule in the negative.

The rules and regulations governing appeals to the Office of the President of the
Philippines are embodied in Administrative Order No. 18. Section 7 thereof
provides:

Sec. 7. Decisions/resolutions/orders of the Office of the President


shall, except as otherwise provided for by special laws, become final
after the lapse of fifteen (15) days from receipt of a copy thereof by
the parties, unless a motion for reconsideration thereof is filed within
such period.

Only one motion for reconsideration by any one party shall be


allowed and entertained, save in exceptionally meritorious cases.
(Emphasis ours).

It is further provided for in Section 9 that "The Rules of Court shall apply in
a suppletory character whenever practicable.

When the Office of the President issued the Order dated June 23, 1997 declaring
the Decision of March 29, 1996 final and executory, as no one has seasonably
filed a motion for reconsideration thereto, the said Office had lost its jurisdiction
to re-open the case, more so modify its Decision. Having lost its jurisdiction, the
Office of the President has no more authority to entertain the second motion for
reconsideration filed by respondent DAR Secretary, which second motion
became the basis of the assailed "Win-Win" Resolution. Section 7 of
Administrative Order No. 18 and Section 4, Rule 43 of the Revised Rules of
Court mandate that only one (1) motion for reconsideration is allowed to be taken
from the Decision of March 29, 1996. And even if a second motion for
reconsideration was permitted to be filed in "exceptionally meritorious cases," as
provided in the second paragraph of Section 7 of AO 18, still the said motion
should not have been entertained considering that the first motion for
reconsideration was not seasonably filed, thereby allowing the Decision of March
29, 1996 to lapse into finality. Thus, the act of the Office of the President in re-
opening the case and substantially modifying its March 29, 1996 Decision which
had already become final and executory, was in gross disregard of the rules and
basic legal precept that accord finalityto administrative determinations.

In San Luis, et al. vs. Court of Appeals, et al. 60 we held:

Since the decisions of both the Civil Service Commission and the
Office of the President had long become final and executory, the
same can no longer be reviewed by the courts. It is well-established
in our jurisprudence that the decisions and orders of administrative
agencies, rendered pursuant to their quasi-judicial authority, have
upon their finality, the force and binding effect of a final judgment
within the purview of the doctrine of res judicata [Brillantes v. Castro,
99 Phil. 497 (1956), Ipekdijna Merchandizing Co., Inc. v. Court of Tax
Appeals, G.R. No. L-15430, September 30, 1963, 9 SCRA 72.] The
rule of res judicata which forbids the reopening of a matter once
judicially determined by competent authority applies as well to the
judicial and quasi-judicial acts of public, executive or administrative
officers and boards acting within their jurisdiction as to the
judgments of courts having general judicial powers [Brillantes v.
Castro, supra at 503].

The orderly administration of justice requires that the judgments/resolutions of a


court or quasi-judicial body must reach a point of finality set by the law, rules and
regulations. The noble purpose is to write finis to disputes once and for all. 61 This is
a fundamental principle in our justice system, without which there would no end to litigations. Utmost respect and adherence to this principle
must always be maintained by those who wield the power of adjudication. Any act which violates such principle must immediately be struck
down.

Therefore, the assailed "Win-Win" Resolution which substantially modified the


Decision of March 29, 1996 after it has attained finality, is utterly void. Such void
resolution, as aptly stressed by Justice Thomas A. Street 62 in a 1918 case,63 is "a lawless thing,
64
which can be treated as an outlaw and slain at sight, or ignored wherever and whenever it exhibits its head."

WHEREFORE, the present petition is hereby GRANTED. The challenged


Resolution dated November 7, 1997, issued by the Office of the President in OP
Case No. 96-C-6424, is hereby NULLIFIED and SET ASIDE. The Motion For
Leave To Intervene filed by alleged farmer-beneficiaries is hereby DENIED.

No pronouncement as to costs.
G.R. No. 138979 October 9, 2000

ERNESTO BUNYE, petitioner,


vs.
LOURDES AQUINO, CITA AQUINO and ROBERTO AQUINO, respondents.

GONZAGA-REYES, J.:

Assailed in this petition for review is the June 15, 1999 Decision of the Court of
Appeals which modified its own decision promulgated on November 26, 1998
with regard to the size of the homelot awarded to respondents.1

Respondents Lourdes, Cita and Roberto, all surnamed Aquino, are the children
of the late Bartolome Aquino who was instituted in 1967 as a tenant over a
16,974.50 square meter lot located at Ilaya street, Alabang, Muntinlupa, Metro
Manila belonging to Zoilo Bunye, the father of petitioner Ernesto Bunye.
Sometime in 1970, Zoilo Bunye told Bartolome Aquino to stop cultivating
14,474.50 square meters of the land since the former was going to devote the
same to commercial uses. No disturbance compensation was paid to Bartolome
Aquino, but Zoilo Bunye permitted Bartolome Aquino to continue cultivating the
remaining 2,500 square meters and promised him a homelot within the said area.
Considering himself aggrieved, Bartolome Aquino repaired to the Court of
Agrarian Relations (CAR) in order to seek judicial recognition of his tenancy
status over the remaining 2,500 square meters.2 The CAR rendered judgment
recognizing Bartolome Aquino as a tenant over 2,500 square meters of the
subject property with a fixed annual rental of P140.00. On November 5, 1976, the
Court of Appeals affirmed the CAR's decision.3 Thus, Bartolome Aquino
continued in the possession and cultivation of 2,500 square meters of Zoilo
Bunye's land and he constructed his family home on a 500 square meter area
thereon.

On February 20, 1986, the then Minister of Agrarian Reform Conrado Estrella
approved Ernesto Bunye's petition for the conversion of the 2,500 square meters
of land tenanted by respondents from agricultural land to residential and
commercial land. Petitioner was able to eject respondents from 2,000 square
meters of the converted land, leaving only 500 square meters in the possession
of respondents. Since petitioner sought to eject respondents from even the 500
square meters of land they occupied, respondents filed a complaint with the
Office of the Regional Agrarian Reform Adjudicator, insisting that they are entitled
to the possession of the 500 square meters of land occupied as a homelot as
part of the compensation for the deprivation of the 16,974.5 square meters of
land originally tenanted by Bartolome Aquino.4

On April 11, 1996, the Regional Adjudicator Fe Arche-Manalang held that no


tenurial relations could exist between the parties as the land had ceased to be
agricultural by virtue of its conversion in 1986, even before Bartolome Aquino's
death in 1988. Correspondingly, respondents cannot claim entitlement to
possession of the homelot originally granted to their father since the right to the
same is co-terminous with the existence of an agricultural leasehold relationship.
Petitioner was ordered to pay respondents disturbance compensation for the
latter's dispossession from 2,500 square meters of tenanted land. The Regional
Adjudicator also awarded a 75 square meter homelot to respondents but only as
an alternative relief in the event that the disturbance compensation could not be
computed. The factual findings and conclusions of the Regional Adjudicator are
set out below

Before delving into the merits of the first issue cited above, the following
undisputed facts must be borne in mind:

1. Bartolome Aquino's tenancy status over a 2,500 sq. m. portion of the


property presently registered in the name of Z. E. Bunye and Sons Realty
Estate Corporation under TCT No-S-77427 was affirmed by the Court of
Appeals in a decision rendered as early as November 5, 1976;

2. On February 20, 1986, the said 2,500 sq. m. was approved for
conversion subject to the payment of disturbance compensation to the
affected tenant;

3. As found in the ocular inspection and investigation report incorporated in


the aforementioned Order of Conversion dated February 20, 1986, only
about 500 sq. m. remained devoted to agricultural cultivation, the rest
being utilized for residential use by the identified tenant Bartolome Aquino.

Against this backdrop, the only inevitable conclusions that can be drawn
are: 1) at the time of the original tenant Bartolome Aquino's death in 1988,
the property in question ceased to be agricultural in nature and character
by virtue of its conversion to non-agricultural use in 1986; 2) since no valid
tenurial relations can continue to exist on land that is no longer agricultural
it follows that no tenancy relationship can possibly devolve by way of
succession upon the tenant's surviving heirs with his death in 1988 as
envisioned in Section 9 of RA 3844, as amended. As things now stand,
Complainants cannot even demand the right to continue in the exclusive
possession and enjoyment of any homelot awarded to their late father as
the same is co-terminous with the existence of a legitimate tenancy or
agricultural leasehold relationship (Vide, Section 22 (3), RA 1199 as
amended) which is not the situation obtaining in the case at bar. All they
can hope for is to claim payment of disturbance compensation which was
denied in 1986 to their father during his lifetime equivalent to five times the
average of the gross harvests on the landholding during the last preceding
calendar years (Vide, Section 36 (1) of RA 3844 as amended). Even
assuming arguendo that the late tenant was promised a homelot consisting
of 500 sq. m. in lieu of a disturbance compensation, such verbal
agreement is unenforceable as it is not contained in a public document as
required by law.

Viewed in the light of the foregoing discussion, the first and second issues
can only be resolved adversely against the Complainants EXCEPT in the
matter of payment of disturbance compensation to which they are fully
entitled. However, by way of alternative relief since no production data is
extant in the records upon which the said computation can be based, this
Office in the exercise of its equity jurisdiction, deems it appropriate to
award to the Complainants in lieu thereof a homelot consisting of 75 sq. m.
as originally offered by the Respondent in their initial exploratory talks on
the possibility of an amicable settlement or compromise.5

xxx xxx xxx

On June 10, 1998, the Department of Agrarian Reform Adjudication Board


(DARAB) affirmed the Regional Adjudicator's decision.6

Respondents elevated the matter before the Court of Appeals. Although the
Court of Appeals modified the DARAB's decision by providing that disturbance
compensation should be paid for the entire 16,974.50 square meters of the
subject property, it upheld the award of 75 square meters in favor of respondents
in lieu of disturbance compensation. The appellate court explained in its
November 26, 1998 decision that

There is nothing in the records to show that Zoilo Bunye granted


Bartolome Aquino a homelot of 500 sq. m. as claimed by the heirs of the
latter. The evidence shows that Bunye converted 14,474.50 out of his
16,924.50 sq. m. landholding for commercial purposes and left 2,500 sq.
m. to be cultivated by his tenant Bartolome Aquino promising him a
homelot therein without specifying the area. The fact that Aquino set aside
and occupied upon his own decision 500 sq. m. as his homelot does not
entitle him to the same area as a matter of right, absent a specific grant
from Bunye.

However, there seems to be no question that Bartolome Aquino did not


receive disturbance compensation for the 14,974.50 sq. m. of which he
was dispossessed; neither were his heirs paid any such compensation for
the 2,500 sq. m. left which Ernesto Bunye also had converted into a
commercial lot.

The DARAB did not err when it affirmed the decision of the Regional
Adjudicator granting the petitioners disturbance compensation. However,
the decision did not specify the area for which such compensation is to be
paid. We believe that the compensation should be for the entire 16,974.50
sq. m. previously tenanted by Bartolome Aquino and later by his heirs,
since it is admitted that the tenant was not paid such disturbance
compensation when the land was converted into a commercial area.

We likewise agree with the DARAB when it set aside an area of 75 sq. m.
as the homelot for the heirs of Aquino. The area is reasonable enough
considering the purpose for which it is intended.

The Aquinos, however, want the privilege to be able to choose whether


they will avail of the 75 sq. m. homelot or the disturbance compensation for
the entire 16,974.50 to which they are entitled in the event that they are
found not entitled to the 500 sq. m. homelot they claim. We think that this is
reasonable and is not prohibited by any existing law.

WHEREFORE, premises considered, the judgment of the Department of


Agrarian Reform Adjudication Board is AFFIRMED with the clarification
that the disturbance compensation payable shall be for the whole area of
16,974.50 sq. m. and with the modification that the petitioners shall be
allowed to choose whether they opt for the payment of disturbance
compensation or for a homelot of 75 sq. m..

No costs.

SO ORDERED.7

However, acting upon a motion for reconsideration filed by respondents, the


Court of Appeals modified its decision by increasing the size of the homelot to
500 square meters. In its assailed decision promulgated on June 15, 1999, the
appellate court ratiocinated that

xxx xxx xxx

The petitioners pointed out that at the time their father Bartolome Aquino
gave up to his landowner the 14,974.50 sq. m. being worked by him which
was converted to commercial use in 1970, their father was not paid any
disturbance compensation, but was promised a homelot out of the 2,500
sq. m. left; that while it is true that the landowner had the right to choose
which portion of the land tenanted should be used as a homelot, this right
was not exercised by the landowner in this case and the choice was left to
their father Bartolome Aquino which portion of the 2,500 sq. m. would be
left as his homelot.

The petitioners further argue that since the tenancy of their father
Bartolome Aquino over the land of respondent Bunye's predecessor took
place before the approval of Republic Act 3844 on August 8, 1963, his right
to a homelot was governed by Republic Act 1199 which was passed on
August 30, 1954, Section 22 of which provides:

"Sec. 22. Par. (3) The tenant shall have the right to demand for a
homelot suitable for dwelling with an area of not more than 3 percent
of the area of his landholding provided that it does not exceed one
thousand square meters and that it shall be located at a convenient
and suitable place within the land of the landholder to be designated
by the latter where the tenant shall construct his dwelling and may
raise vegetables, poultry, pigs and other animals and engage in
minor industries, the products of which shall accrue to the tenant
exclusively. . . ."

Thus, they contend that three (3) percent of 16,924.80 is 507.75 sq. m. so
that the area of 500 sq. m. occupied by the late Bartolome Aquino as a
homelot is just right for the total area of 16,924.80 sq. m. being tenanted
by him when 14,974.80 was converted for commercial purposes.

We find petitioners' Motion for Reconsideration meritorious.

The Decision of this Court dated November 26, 1998 setting aside 75
square meters of the land in question as a homelot for the petitioners is
therefore modified by increasing the area to five hundred (500) square
meters.

SO ORDERED.8

Petitioner is now before this Court disputing the legality of the appellate court's
decision to increase the size of the homelot awarded to respondents to 500
square meters. It is pointed out by petitioner that in both the April 11, 1996
DARAB decision and in the November 5, 1976 Court of Appeals decision (CA-
G.R. No. 04377-CAR) the tenancy right of Bartolome Aquino was limited to 2,500
square meters of the subject land. Thus, the size of the homelot should have
been determined based on 2,500 square meters, not 16,924.80 square meters.
Petitioner prays that the June 15, 1999 decision of the Court of Appeals be
annulled, and that we reinstate the original decision promulgated on November
26, 1998, except for that portion decreeing that the disturbance compensation be
computed based on 16,974.50 square meters of tenanted land, a matter also
disputed by petitioner.9

On the other hand, respondents insist that they are entitled to 500 square meters
for use as a homelot based on the alleged promise of Zoilo Bunye to their father
Bartolome Aquino of a homelot out of the remaining 2,500 square meters, which
promise was made when Bartolome Aquino was dispossessed of 14,474.50
square meters of the total area of 16,974.50 square meters of tenanted land.10

We are unable to sustain the assailed decision of the Court of Appeals. There is
nothing in the records to support respondents' claim that Zoilo Bunye gave
Bartolome Aquino 500 square meters of land to be used as a homelot. The
Regional Adjudicator, the DARAB and the Court of Appeals (in its November 26,
1998 decision) all found that the respondents were entitled to 75 square meters
of land, not because of the alleged promise by petitioner's predecessor, but
rather, in lieu of disturbance compensation for their dispossession of tenanted
land. Yet, in an unexpected reversal of its original decision, the appellate court
increased the area of the homelot to 500 square meters based merely on
respondents' insistence that Zoilo Bunye promised Bartolome Aquino a homelot
within the 2,500 square meters of tenanted land. Respondents claim that since
Zoilo Bunye did not designate what portion of the land should be used as a
homelot, Bartolome Aquino had the right to decide the matter for himself. Clearly,
by relying solely on respondents' self-serving allegations, the assailed decision is
not supported by substantial evidence the requisite quantum of evidence in
agrarian cases.11 Moreover, the appellate court premised its decision to increase
the size of the homelot to 500 square meters upon an erroneous application of
Republic Act No. 1199, proceeding from respondents' allegation that the tenancy
relationship between Zoilo Bunye and Bartolome Aquino was established before
the approval of Republic Act No. 3844 on August 8, 1963. It has already been
established in the decision of the Regional Adjudicator, as affirmed by the
DARAB, and in the November 26, 1998 decision of the Court of Appeals that the
tenancy relation began sometime in 1967. We find no reason to overturn this
factual finding. In addition, it was admitted by respondents in their complaint filed
with the Office of the Regional Agrarian Reform Adjudicator that it was only in
1967 that Zoilo Bunye verbally instituted Bartolome Aquino as a tenant upon his
land.12 Thus, contrary to the appellate court's declaration, the applicable law is
Republic Act No. 3844 which took effect on August 22, 1963, and not Republic
Act No. 1199.

Even assuming that Zoilo Bunye did in fact promise and deliver 500 square
meters of his land to Bartolome Aquino for use as a homelot, the right of the latter
to enjoy the same ceased when the remaining 2,500 square meters of
petitioner's land was converted to residential and commercial land in 1986.
Republic Act No. 3844, as amended by Republic Act No. 6389,13 provides

SECTION 36. Possession of Landholding; Exceptions. Notwithstanding


any agreement as to the period or future surrender of the land, an
agricultural lessee shall continue in the enjoyment and possession of his
landholding except when his dispossession has been authorized by the
Court in a judgment that is final and executory if after due hearing it is
shown that:

(1) The landholding is declared by the department head upon


recommendation of the National Planning Commission to be suited for
residential, commercial, industrial or some other urban
purposes: Provided, That the agricultural lessee shall be entitled to
disturbance compensation equivalent to five times the average of the gross
harvests on his landholding during the last five preceding calendar years;

xxx xxx xxx

Neither petitioner nor respondent questioned the conversion decreed in 1986,


which was a factual finding of both the Department of Agrarian Reform and the
Court of Appeals; therefore, it should be presumed that the conversion was
validly and legally done. Thus, even before Bartolome Aquino died in 1988,
tenurial relations had already been extinguished, leaving respondents without
any claim upon the homelot allegedly promised by Zoilo Bunye to their father.

In the event that tenanted land is converted pursuant to section 36 of Republic


Act No. 3844, the only relief available to respondents is the payment of
disturbance compensation equivalent to five times the average of the gross
harvests on his landholding during the last five preceding calendar years. The
award of 75 square meters of land originally granted by the Regional Adjudicator
and subsequently affirmed by the DARAB was made in lieu of disturbance
compensation for the dispossession of respondents of 2,500 square meters of
land. Although the Court of Appeals in its November 26, 1998 Decision affirmed
the grant of 75 square meters of land as reasonable, it simultaneously declared
that respondents are entitled to disturbance compensation for the entire
16,974.50 square meters of land originally tenanted by Bartolome Aquino.

On this point, we agree with petitioner that the appellate court committed a
reversible error when it awarded disturbance compensation for 16,974.50 square
meters. In 1970, Bartolome Aquino was dispossessed of 14,474.50 square
meters when the land was converted to commercial use. Bartolome Aquino then
filed a complaint with the CAR seeking to be recognized as a tenant over the
remaining 2,500 square meters of the subject land.14He did not make a claim for
disturbance compensation for the 14,474.50 square meters of land of which he
was dispossessed. The CAR rendered judgment recognizing Bartolome Aquino
as a tenant over 2,500 square meters of land, which decision was upheld by the
Court of Appeals (CA-G.R. No. 04377), but neither the CAR nor the appellate
court awarded any disturbance compensation. Notwithstanding, from 1976 until
1995 respondents never sought the payment of disturbance compensation for
the 14,474.50 square meters of land. Under section 38 of Republic Act No. 3844,
an action to enforce any cause of action under such law shall be barred if not
commenced within three years after such cause of action
accrued.15 Unquestionably, respondents' claim for disturbance compensation for
the 14,474.50 square meters of land of which their father was dispossessed in
1970 has prescribed. Thus, respondents are only entitled to disturbance
compensation for their dispossession of 2,500 square meters of land and we find
that, in the absence of adequate data on the land's harvests, the award of 75
square meters is a fair and adequate alternative relief.

WHEREFORE, the June 15, 1999 Decision of the Court of Appeals is


hereby SET ASIDE. Accordingly, weREINSTATE the appellate court's November
26, 1998 Decision with the modification that the disturbance compensation
should only be paid for the dispossession of respondents from 2,500 square
meters of petitioner's land.

G.R. No. 139254. March 18, 2005

SOCIAL SECURITY SYSTEM, Petitioners,


vs.
DEPARTMENT OF AGRARIAN REFORM, represented by its Secretary,
HONORABLE ERNESTO GARILAO, and the REGISTER OF DEEDS OF
MARIKINA CITY, represented by its Registrar, GREGORIO SEMBRANO, and
FARMER-BENEFICIARIES, as indicated in Respective Tranfer Certificates of
Title Nos. 1259, 1260, and 1261, named hereunder, Respondents.

DECISION

CHICO-NAZARIO, J.:

The Social Security System (SSS) filed against the Department of Agrarian
Reform (DAR), the Register of Deeds of Marikina City and several farmers-
beneficiaries, a complaint (Civil Case No. 1300-97)1 for Annulment of Transfer
Certificates of Title (TCTs) No. 1259, No. 1260, and No. 1261 with Recovery of
Possession and prayer for the issuance of a writ of preliminary injunction before
the Regional Trial Court (RTC) of San Mateo, Rizal, Branch 75.

In its Complaint, the SSS alleged it is the absolute owner of several parcels of
land located at Rodriguez, Rizal, with an area of more or less three hundred
hectares. The said property was covered under Republic Act No. 6657
(Comprehensive Agrarian Reform Program [CARP]) by the DAR. The SSS earlier
filed a case for conversion of the land, from agricultural to residential and other
urban uses, before the DARs Adjudicatory Board which was denied by the DAR
on 22 March 1990.2 Undaunted, the SSS filed before the Court of Appeals a
Petition for Review onCertiorari, CA-G.R. SP No. 38043 which was dismissed on
31 August 1995.3 The SSS elevated the case to this Court on Petition for Review
on Certiorari, G.R. No. 122580, which was again denied for failure to comply with
Circular No. 1-88,4 it appearing that petitioner SSS failed to submit a verified
statement of material dates to determine the timeliness of the filing of the petition
and the timeliness of the payment of legal fees as required by par. 4 of the said
circular.5 Its motion for reconsideration was denied in a resolution of this Court
dated 27 March 1996.6 The denial has become final and executory and Entry of
Judgment was issued on 27 June 1996.7

Meanwhile, DAR issued Certificates of Land Ownership Award (CLOAs) to some


201 persons identified as farmers-beneficiaries of the land on 23 December
1991. On 11 July 1997,8 the defendants filed a joint motion to dismiss claiming
that jurisdiction over the case falls with the Department of Agrarian Reform
Adjudication Board (DARAB). In an Order dated 12 March 1999, the
RTC9 granted the joint motion to dismiss.10 From this Order, the SSS is now
before us arguing that the RTC erred in holding it has no jurisdiction over the
case.11

In a resolution dated 16 August 1999, this Court denied the Petition for failure of
the petitioner to serve a copy thereof to the respondent court.12

The SSS filed a motion for reconsideration.13 In a resolution dated 20 October


1999, this Court resolved to grant the motion and required the respondents to
comment on the Petition.14
On 10 August 2000, respondents farmers-beneficiaries filed their
compliance.15 From a resolution dated 27 November 2000, the parties were
required to file their respective Memorandum.16

Insisting on the jurisdiction of the trial court over the case, the SSS averred that
the issue raised before the trial court was not the issuance of the CLOAs, nor the
coverage or exemption of the SSS from the CARP, but the illegality or lack of
legal basis of the cancellation of a valid torrens title in the name of the SSS which
led to the issuance of TCTs No. 1259, No. 1260 and No. 1261 in favor of the
farmers-beneficiaries, without notice and just compensation. It asserts that the
jurisdiction of the DARAB pertains to agrarian disputes which does not obtain in
the case at bar. It points out that under Chapter V, Section 16(f) of Rep. Act No.
6657, jurisdiction is with the RTC.17

On the other hand, negating it has jurisdiction over the case, the trial court held:

The primordial issue to by (sic) resolved is the jurisdiction of the DARAB which
defendants-movants argue to have jurisdiction over the case. Under Rule 11,
Section 1(F) of the DARAB New Rules of Procedure the board has jurisdiction
over cases "involving the issuance, correction and cancellation of Certificates of
Land Ownership Award (CLOAs) and Emancipation Patents (EPs) which are
registered with the Land Registration Authority." The present case was filed by
plaintiff SSS precisely to annul Certificate of Title Nos. 1259, 1260 and 1261
which, as pointed out by defendants-movants, emanated from CLOAs issued by
the Department of Agrarian Reform. The present case ultimately involves CLOAs
and is, therefore, within the jurisdiction of the DARAB. In fine, since SSS seeks
annulment of the above-mentioned titles which emanated from CLOAs, the
proper venue for the present case is the DARAB.

As to the argument raised by the SSS regarding the nature of the land, suffice it
to say that since plaintiff itself has filed a petition with the DAR for conversion of
the classification of the subject parcel of land from agricultural to residential land,
it has expressly recognized that said parcels of land to be agricultural land. This
being the case, said parcels of land are under the jurisdiction of DARAB because
under Section 4 of R.A. 6657 "all public and private agricultural land" are covered
by CARP and all disputes involving lands covered by the CARP are within the
jurisdiction of the DARAB.
SSS should not be allowed in one breath to invoke the jurisdiction of the DARAB
and then, after failing to obtain the relief it sought, assail the same and now claim
that jurisdiction rests with the regular courts. It should be noted at this point that
the application for conversion filed by the SSS had been finally disposed off by
no less tha[n] the Supreme Court.18

The Petition lacks merit.

Irrefragably, the titles sought to be annulled by the SSS, namely, TCTs No. 1259,
No. 1260 and No. 1261 originated from the CLOAs issued by the DAR in
pursuance of, and in accordance with, the provisions of Rep. Act No. 6657, the
Comprehensive Agrarian Reform Program.

Specifically, the SSS in its Complaint implored the trial court "to restrain the DAR
from implementing Rep. Act No. 6657 and the defendants, farmers-beneficiaries
from occupying/tilling, cultivating /disposing the properties."19

Section 1, Rule II, 2002 DARAB Rules of Procedure provides that:

Section 1. Primary And Exclusive Original and Appellate Jurisdiction. The board
shall have primary and exclusivejurisdiction, both original and appellate, to
determine and adjudicate all agrarian disputes involving the implementation of
the Comprehensive Agrarian Reform Program (CARP) under Republic Act No.
6657, Executive Order Nos. 228, 229, and 129-A, Republic Act No. 3844 as
amended by Republic Act No. 6389, Presidential Decree No. 27 and other
agrarian laws and their implementing rules and regulations. Specifically, such
jurisdiction shall include but not be limited to cases involving the following:

a) The rights and obligations of persons, whether natural or juridical engaged in


the management, cultivation and use of all agricultural lands covered by the
CARP and other agrarian laws.

...

Specifically, such jurisdiction shall extend over but not limited to the following:

...
f) Cases involving the issuance of Certificate of Land Transfer (CLT), Certificate
of landownership Award (CLOA) and Emancipation Patent (EP) and the
administrative correction thereof; (Italics added)

Thus, taking its bearings from the above provision, Centeno v.


Centeno20 explicitly and compellingly validated the jurisdiction of the DARAB over
cases involving issuance of CLOAs, and went on further:

. . . under Section 50 of R.A. 6657 (the Comprehensive Agrarian Reform Law of


1988), the DAR is vested with primary jurisdiction to determine and adjudicate
agrarian reform matters and shall have the exclusive jurisdiction over all matters
involving the implementation of the agrarian reform program. The rule is that the
DARAB has jurisdiction to try and decide any agrarian dispute or any incident
involving the implementation of the Comprehensive Agrarian Reform Program.
(Italics supplied)

Section 1, Rule II of the Revised Rules of Procedure of the DARAB 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, andmatters
or incidents involving the implementation of the Comprehensive Agrarian Reform
Program under Republic Act No. 6657, Executive Orders 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.

In the relatively recent case of Rivera v. Del Rosario,21 this Court cited Section 1,
Rule II, 2002 DARAB Rules of Procedure and reiterated that:

The DARAB has exclusive original jurisdiction over cases involving the rights and
obligations of persons engaged in the management, cultivation and use of all
agricultural lands covered by the Comprehensive Agrarian Reform Law.

Again in David v. Rivera,22 this Court pointed out that the jurisdiction over agrarian
reform matters is now expressly vested in the DAR through the DARAB.

Indeed, Section 50 of R.A. 6657 confers on the Department of Agrarian Reform


(DAR) quasi-judicial powers to adjudicate agrarian reform matters. In the process
of reorganizing the DAR, Executive Order No. 129-A created the DARAB to
assume the powers and functions with respect to the adjudication of agrarian
reform cases. Section 1, Rule II of the DARAB Rules of Procedure enumerates
the cases falling within the primary and exclusive jurisdiction of the DARAB.

In an earlier ruling rendered in the case of Vda. de Tangub v. Court of


Appeals,23 reiterated in Morta, Sr. v. Occidental24 and Heirs of the late Herman
Rey Santos v. Court of Appeals,25 this Court decreed:

Section 1 of Executive Order No. 229 sets out the scope of the Comprehensive
Agrarian Reform Program (CARP); it states that the program

". . . shall cover, regardless of tenurial arrangement and commodity produce, all
public and private agricultural land as provided in Proclamation No. 131 dated
July 22, 1987, including whenever applicable in accordance with law, other lands
of the public domain suitable to agriculture."

Section 17 thereof

1) vested the Department of Agrarian Reform with "quasi-judicial powers to


determine and adjudicate agrarian reform matters," and

2) granted it "jurisdiction over all matters involving implementation of agrarian


reform, except those falling under the exclusive original jurisdiction of the DENR
and the Department of Agriculture (DA), as well as `powers to punish for
contempt and to issue subpoena, subpoena duces tecum and writs to enforce its
orders or decisions."26

In Nuesa v. Court of Appeals,27 the Court, in addition to re-echoing the jurisdiction


of the DARAB, puts emphasis on the extent of the coverage of the term "agrarian
dispute," thus:

As held by this Court in Centeno v. Centeno [343 SCRA 153], "the DAR is vested
with the primary jurisdiction to determine and adjudicate agrarian reform matters
and shall have the exclusive jurisdiction over all matters involving the
implementation of the agrarian reform program." The DARAB has primary,
original and appellate jurisdiction "to determine and adjudicate all agrarian
disputes, cases, controversies, and matters or incidents involving the
implementation of the Comprehensive Agrarian Reform Program under R.A.
6657, E.O. Nos. 229, 228 and 129-A, R.A. 3844 as amended by R.A. 6389, P.D.
No. 27 and other agrarian laws and their implementing rules and regulations."

Under Section 3(d) of R.A. 6657 (CARP Law), "agrarian dispute" is defined to
include "(d). . . any controversy relating to tenurial arrangements, whether
leasehold, tenancy, stewardship or otherwise over lands devoted to agriculture,
including disputes concerning farmworkers associations or representation of
persons in negotiating, fixing, maintaining, changing or seeking to arrange terms
or conditions of such tenurial arrangements. It includes any controversy relating
to compensation of lands acquired under this Act and other terms and conditions
of transfer of ownership from landowners to farmworkers, tenants and other
agrarian reform beneficiaries, whether the disputants stand in the proximate
relation of farm operator and beneficiary, landowner and tenant, or lessor and
lessee." (Underlining ours)

In the light of the foregoing, and guided by the pronouncements made by this
Court in the cases cited above, we find that the trial court correctly ruled that the
DARAB has jurisdiction to hear and decide the case of herein petitioner SSS.

Wherefore, premises considered, the instant petition for review is Denied for lack
of merit.

G.R. No. 176942 August 28, 2008

NICORP MANAGEMENT AND DEVELOPMENT CORPORATION, petitioner,


vs.
LEONIDA DE LEON, respondent.

x ------------------------------------------------------ x

G.R. No. 177125 August 28, 2008

SALVADOR R. LIM, petitioner,


vs.
LEONIDA DE LEON, respondent.

DECISION

YNARES-SANTIAGO, J.:
These consolidated petitions assail the November 8, 2006 Decision1 of the
Court of Appeals in CA-G.R. SP No. 92316, finding respondent Leonida de
Leon as a bonafide tenant of the subject property, thereby reversing and
setting aside the Decision of the Department of Agrarian Reform Adjudication
Board (DARAB) in DARAB Case No. 135022 which affirmed the Decision3 of
the Regional Adjudicator in DARAB Case No. 0402-031-03. Also assailed is
the March 1, 2007 Resolution4 denying the motions for reconsideration.

On August 26, 2004, respondent filed a complaint before the Office of the
Provincial Agrarian Reform Adjudicator (PARAD) of Region IV- Province of
Cavite, praying that petitioners Salvador R. Lim and/or NICORP Management
and Development Corporation (NICORP) be ordered to respect her tenancy
rights over a parcel of land located in Barangay Mambog III, Bacoor, Cavite,
registered under TCT No. T-72669 in the name of Leoncia De Leon and
Susana De Leon Loppacher (De Leon sisters), who were likewise impleaded
as parties-defendants in the suit.

Respondent alleged that she was the actual tiller and cultivator of the land
since time immemorial with full knowledge and consent of the owners, who
were her sisters-in-law; that sometime in 2004, petitioners circulated rumors
that they have purchased the property from the De Leon sisters; that
petitioners ignored respondents requests to show proof of their alleged
ownership; that on August 12, 2004, petitioners entered the land and uprooted
and destroyed the rice planted on the land and graded portions of the land
with the use of heavy equipment; that the incident was reported to the
Municipal Agrarian Reform Office (MARO) which issued a Cease and Desist
Order5 but to no avail.

Respondent thus prayed that petitioners be ordered to respect her tenancy


rights over the land; restore the land to its original condition and not to convert
the same to non-agricultural use; that any act of disposition of the land to any
other person be declared null and void because as a tenant, she allegedly had
a right of pre-emption or redemption over the land; and for actual damages
and attorneys fees.6

Petitioner Lim denied that respondent was a tenant of the subject property
under the Comprehensive Agrarian Reform Program (CARP). He alleged that
respondent is a septuagenarian who is no longer physically capable of tilling
the land; that the MARO issued a certification7 that the land had no registered
tenant; that respondent could not be regarded as a landless tiller under the
CARP because she owns and resides in the property adjacent to the subject
land which she acquired through inheritance; that an Affidavit of Non-
Tenancy8 was executed by the De Leon sisters when they sold the property to
him.

Moreover, Lim claimed that respondent and her family surreptitiously entered
the subject land and planted a few crops to pass themselves off as cultivators
thereof; that respondent tried to negotiate with petitioner Lim for the sale of
the land to her, as the latter was interested in entering into a joint venture with
another residential developer, which shows that respondent has sufficient
resources and cannot be a beneficiary under the CARP; that the land is no
longer classified as agricultural and could not thus be covered by the CARP.
Per certification issued by the Office of the Municipal Planning and
Development Coordinator of Bacoor, Cavite, the land is classified as
residential pursuant to a Comprehensive Land Use Plan approved by the
Sangguniang Panlalawigan.9

For its part, petitioner NICORP asserted that it was not a proper party to the
suit because it has not actually acquired ownership of the property as it is still
negotiating with the owners. However, it joined in petitioner Lims assertion
that respondent is not a qualified tenant; and that the subject land could not
be covered by the CARP since it is below the minimum retention area of five
hectares allowed under the program.10 Eventually, NICORP purchased the
subject property from Lim on October 19, 2004.11

The De Leon sisters did not file a separate answer to respondent's complaint.

Meanwhile, Provincial Adjudicator Teodoro A. Cidro, to whom the case was


assigned, died. Thus, the case was referred to the Office of the Regional
Agrarian Reform Adjudicator (RARAD) for resolution.

In compliance with the directive of the RARAD, respondent submitted as


evidence an Extra-Judicial Settlement of Estate12 dated February 20, 1989 to
prove that, as a result of her relationship with her sisters-in-law, she was
made a tenant of the land; a tax declaration13 showing that the land was
classified as irrigated riceland; several affidavits14 executed by farmers of
adjacent lands stating that respondent and her family were tenants-farmers on
the subject land; and several documents and receipts15 to prove the
agricultural activities of respondent and her family.

Respondent likewise submitted a handwritten letter16 of Susana De Leon


addressed to respondents daughter Dolores, showing that the former
purportedly acknowledged respondent's son, Rolando, as the legitimate
tenant-lessee on the land. However, Rolando died on September 1, 2003 as
evidenced by his death certificate.17

On December 6, 2004, the RARAD rendered a Decision dismissing the


complaint for failure of respondent to prove by substantial evidence all the
requisites of an agricultural tenancy relationship.18 There was no evidence to
show that the De Leon sisters constituted respondent as tenant-lessee on the
land; neither was it proved that there was sharing of harvests with the
landowner.

The DARAB affirmed the decision of the RARAD.19

On appeal, the Court of Appeals reversed and set aside the findings of the
RARAD/DARAB stating that there was sufficient evidence to prove the
elements of an agricultural tenancy relationship; that the letter of Susana De
Leon to Dolores clearly acknowledged respondents son, Rolando, as a
tenant, as well as respondents share in the proceeds of the sale of the land;
and that the sharing of produce was established by the affidavits of
neighboring farmers that were not controverted by petitioners.

The appellate court further held that the reclassification of the land by the
Sangguniang Panlalawigan as residential cannot be given weight because it is
only the Department of Agrarian Reform (DAR) that can reclassify or convert
an agricultural land to other uses or classifications; and that the sale of the
land by the De Leon sisters to petitioner Lim is void because it violated
Section 70 of Republic Act (R.A.) No. 665720 or the Comprehensive Agrarian
Reform Law (CARL).
Petitioners filed a motion for reconsideration but it was denied.21 Hence,
petitioners Lim and NICORP separately filed petitions under Rule 45 of the
Rules of Court, which were consolidated per resolution of the Court dated
June 4, 2007.22

Petitioners allege that respondent failed to prove by substantial evidence all


the elements of a tenancy relationship; hence the Court of Appeals erred in
finding that respondent has tenancy rights over the subject land.

The petitions are meritorious.

There is a tenancy relationship if the following essential elements concur: 1)


the parties are the landowner and the tenant or agricultural lessee; 2) the
subject matter of the relationship is an agricultural land; 3) there is consent
between the parties to the relationship; 4) the purpose of the relationship is to
bring about agricultural production; 5) there is personal cultivation on the part
of the tenant or agricultural lessee; and 6) the harvest is shared between
landowner and tenant or agricultural lessee.23 All the foregoing requisites must
be proved by substantial evidence and the absence of one will not make an
alleged tenant a de jure tenant.24 Unless a person has established his status
as a de jure tenant, he is not entitled to security of tenure or covered by the
Land Reform Program of the Government under existing tenancy laws.25

In the instant case, there is no substantial evidence to support the appellate


courts conclusion that respondent is a bona fide tenant on the subject
property. Respondent failed to prove the third and sixth elements cited above.
It was not shown that the De Leon sisters consented to a tenancy relationship
with respondent who was their sister-in-law; or that the De Leon sisters
received any share in the harvests of the land from respondent or that the
latter delivered a proportionate share of the harvest to the landowners
pursuant to a tenancy relationship.

The letter of Susana De Leon to Dolores, which allegedly proved consent of


the De Leon sisters to the tenancy arrangement, partially reads:

Nuong ako ay nandiyan, hindi nagkaayos ang bukid kasi ang iyong
Kuya Roly ay ayaw na si Noli ang ahente. Pero bago ako umalis ay
nagkasundo kami ni Buddy Lim (Salvador) na aayusin niya at itutuloy
ang bilihan at siya ang bahala sa Kuya Roly mo.

Kaya nagkatapos kami at ang kasama ng Kuya mo ngayon ay si Buddy


Lim. Ang pera na para sa kasama ay na kay Buddy Lim. Ang kaparte ng
Nanay Onching (Leoncia) mo ay nasa akin ang karamihan at ako na
ang mag-aasikaso.

The Court cannot agree with the appellate courts conclusion that from the
tenor of the letter, it is clear that Susana acknowledged respondent's
deceased son as "kasama" or tenant, and recognized as well respondents
share in the proceeds of the sale, thus proving the existence of an implied
leasehold relations between the De Leon sisters and respondent.26 The word
"kasama" could be taken in varying contexts and not necessarily in relation to
an agricultural leasehold agreement. It is also unclear whether the term
"kasama" referred to respondent's deceased son, Rolando, or some other
person. In the first sentence of the second paragraph, the word "kasama"
referred to petitioner Lim while the second sentence of the same paragraph,
did not refer by name to Rolando as "kasama."

Likewise, "Nanay Onching," as mentioned in the letter, referred to Leoncia,


one of the De Leon sisters, on whose behalf Susana kept part of the proceeds
of the sale, and not herein respondent as understood by the Court of Appeals,
who had no right to such share. It is Leoncia who co-owned the property with
Susana and who is therefore entitled to a part of the sale proceeds.

Significantly, respondent was not mentioned at all in Susanas letter, but only
her son, Rolando. However, even if we construe the term "kasama" as
pertaining to Rolando as a tenant of the De Leon sisters, respondent will not
necessarily be conferred the same status as tenant upon her sons death. A
direct ascendant or parent is not among those listed in Section 9 of Republic
Act No. 3844 which specifically enumerates the order of succession to the
leasehold rights of a deceased or incapacitated agricultural tenant, to wit:

In case of death or permanent incapacity of the agricultural lessee to


work his landholding, the leasehold shall continue between the
agricultural lessor and the person who can cultivate the landholding
personally, chosen by agricultural lessor within one month from such
death or permanent incapacity, from among the following: a) the
surviving spouse; b) the eldest direct descendant by consanguinity; or
(c) the next eldest descendant or descendants in the order of their age.
x x x Provided, further that in the event that the agricultural lessor fails
to exercise his choice within the period herein provided, the priority shall
be in accordance with the order herein established.

There is no evidence that the De Leon sisters consented to constitute


respondent as their tenant on the subject land. As correctly found by the
RARAD/DARAB, even the Extra-Judicial Settlement of Estate that respondent
offered in evidence to prove the alleged consent does not contain any
statement from which such consent can be inferred.27 Absent any other
evidence to prove that the De Leon sisters consented to the tenurial
arrangement, respondents cultivation of the land was by mere tolerance of
her sisters-in-law.

The appellate court found that the element of sharing in the produce of the
land was established by the affidavits of neighboring farmers attesting to the
fact that respondent cultivated the land since time immemorial.28 However,
perusal of the said affidavits reveals that there is nothing therein that would
indicate a sharing of produce between the De Leon sisters and respondent.
The affidavits did not mention at all that the De Leon sisters received a portion
of the harvests or that respondent delivered the same to her sisters-in-law.
The affidavits failed to disclose the circumstances or details of the alleged
harvest sharing; it merely stated that the affiants have known respondent to
be the cultivator of the land since time immemorial. It cannot therefore be
deemed as evidence of harvest sharing.

The other pieces of evidence submitted by respondent likewise do not prove


the alleged tenancy relationship. The summary report of the Philippine Crop
Insurance Corporation, the official receipts issued by the National Food
Authority and the certificate of membership in Bacoor Agricultural Multi-
Purpose Cooperative,29 only prove that respondent and her family engaged in
agricultural activities but not necessarily her alleged status as tenant of the De
Leon sisters. Besides, these documents are not even in the name of
respondent but were issued in favor of her daughter Dolores.
That respondent was allowed to cultivate the property without opposition,
does not mean that the De Leon sisters impliedly recognized the existence of
a leasehold relation with respondent. Occupancy and continued possession of
the land will not ipso facto make one a de jure tenant.30 The principal factor in
determining whether a tenancy relationship exists is intent. Tenancy is not a
purely factual relationship dependent on what the alleged tenant does upon
the land but is, moreso, a legal relationship.31 Thus, the intent of the parties,
the understanding when the farmer is installed, and their written agreements,
provided these are complied with and are not contrary to law, are more
important.32

Finally, the sale of the subject land to petitioners did not violate Sections
6533 and 7334 (c) of R.A. No. 6657. There was no illegal conversion of the land
because Sec. 65 applies only to lands which were covered by the CARP, i.e.
those lands beyond the five-hectare retention limit allowed to landowners
under the law, which were distributed to farmers-beneficiaries. In the instant
case, it was not shown that the subject land was covered by the CARP.
Neither was it shown that the sale was made to circumvent the application of
R.A. 6657 or aimed at dispossessing tenants of the land that they till.

The sale of the land to petitioners likewise did not violate R.A. No. 3844 or the
Agricultural Tenancy Act. Considering that respondent has failed to establish
her status as de jure tenant, she has no right of pre-emption or redemption
under Sections 1135 and 1236 of the said law. Even assuming that respondents
son Rolando was a tenant of the De Leon sisters, his death extinguished any
leasehold on the subject land. Section 837 of R.A. 3844 specifically provides
for the extinction of an agricultural leasehold relation, in the absence of
persons enumerated under Section 9 of the law who are qualified to succeed
the deceased tenant.

WHEREFORE, the petitions are GRANTED. The Decision of the Court of


Appeals in CA-G.R. SP No. 92316 and the Resolution denying the motions for
reconsideration are REVERSED and SET ASIDE. The Decision of the
Department of Agrarian Reform Adjudication Board in DARAB Case No.
13502, which affirmed in toto the Decision of the Regional Adjudicator in
DARAB Case No. 0402-031-03, dismissing the complaint of respondent
Leonida De Leon for lack of merit, is REINSTATEDand AFFIRMED.
SO ORDERED.

G.R. No. 168787 September 3, 2008

DEPARTMENT OF AGRARIAN REFORM, represented by Provincial


Agrarian Reform Officer STEPHEN M. LEONIDAS, petitioner,
vs.
POLO COCONUT PLANTATION CO., INC., FLORENCIA D. REMOLLO,
NOLI C. ALCANTARA,1ZOSIMO BARBA, ROBERT B. BAJANA,
EMETERIO V. TAG-AT, JUVENAL T. MENDEZ,2 SHIELA R. REYES, JONITA
M. CADALLO, PRISCO P. BACO, BENJAMIN C. DAYAP, ANTONIO
DEDELES,3 NARCISO D. DIAZ, JOVENIANO REYES,4 RODOLFO C.
SALVA, AVELINO C. BAJANA, PRAXEDES BAJANA, ALEJANDRO T.
GIMOL, EMELINA B. SEDIGO5 andHERMINIGILDO
VILLAFLORES, respondents.

x- - - - - - - - - - - - - - - - - - - - - - - -x

G.R. No. 169271 September 3, 2008

MARTINA Q. ABARCA, TOLENTINA E. ABLAY, CONCHITA M. AC-AC,


JOSEPHINA S. AC-AC, LORETA C. AC-AC, CARIDAD Q. AGUILAR,
DIOSDADO A. AGUILAR, ROMULO S. AGUILAR, SHERLITA T. AGUILAR,
WILFREDO T. ALCANTARA, ANACLETO B. ALFORQUE, RICARDO P.
BACO, RODRIGO P. BACO, SR., DARIO B. BAJANA, SR., DEMETRIO F.
BALBUENA, GREGORIA R. BARBA, TOMAS T. BARBA, WILFREDO R.
BARBA, VIVIAN F. BAROT, DOMINGO O. BAROY, ARTURO A.
BORROMEO, FEDENCIA R. BORROMEO, JUANITA P. CABIL, SALVADOR
A. CABORNAY, SEVERINO M. CABUG-OS, AUREA M. CALDA,
BALTAZAR R. CATALOA, DANILOO B. CURATO, ARNULFO B. DAEL,
DEMOCRITO B. DAGODOG, GENARO C. DURAN, JOSEPHINE M.
ELLEMA, ALBINA R. ELMAGA, ENRIQUE R. ELMAGA, EDWIN L.
ELUMIR, TOMAS M. GABIHAN, ALBERTO A. GASO, PEDRO R. GASO,
VISITACION S. GASO, ERLINDA S. GAZO, ANDRES M. GENEL, DIOSCOR
M. GENEL, ANGEL R. GOMEZ, LORENZO S. GOMEZ, SANTIAGO T.
GOMEZ, SILANDO Q. GOMEZ, CONSORCIA G. GUEVARRA,
FREDESWINDA M. GUMA, CELODONIA A. GUZMAN, HERCULANO B.
GUZMAN, JR., CESAR Q. HAROY, SR., EDDIE Q. HAROY, ROMEO E.
INOFERIO, GENARA R. JUANO, GEVINO B. JUANO, SR., ROGELIA B.
JUANO, ROSALITA G. JUANO, DIOGRACIAS R. LARAZAN, RELINA H.
LARENA, JOSE G. MAGALSO, INOCENCIA G. MALCO, LUCENA B.
MALTO, SANTOS S. MALTAO, ELINA T. MARIMAT, RAMON C. MARIMAT,
MERCY B. MARO, RUTHELMA D. MARO, CHARITA S. MATEO, ALMA D.
MEDINA, ABUNDIO M. MENDEZ, RENOLD S. MINDEZ, ALBERTO B.
MIRA, GAUDENCIA S. MIRA, CRESTITA D. MONTAA, DIONISIA T.
MONTAA, LORETO R. NAPAO, ALICIA P. NILLAS, ESPERANZA M.
OMATANG, JR., FELICISIMA M. ORACION, JOEL M. ORACION,
PATROCINIO T. PAO, LOURDES T. PARTOSA, FABIAN S. PIERO, FELIX
R. PUBLICO, MARIBELLE B. PUBLICO, CARMELITA M. QUILARIO,
ENRIQUE R. QUILARIO, MANOLITA M. QUILARIO, MIGUEL S. QUILERIO,
LEONILA J. QUINQUILLERIA, DELTA M. RAMIREZ, ELIAS O. RAMOS,
CONSOLACION T. REAL, ERLINDA I. REGALA, DOMINGA M. REMAN,
EUGENIO O. REMAN, PEPITA R. REMAN, RODNEY D. REMAN, RONNIE
O. REMAN, SR., DOMINADOR P. REMPOJO, EUTIQUIO T. REMPOJO,
ROSITA C. REMPOJO, CAROLINA T. REYES, DIONISIA M. REYES,
EUGENIA B. REYES, LORETA D. REYES, MARIO S. REYES, LAUREANO
C. RIVERA, PETER C. RIVERA, EVANGELINE Q. RODRIGUEZ, RICARDO
R. RODRIGUEZ, PATROCINIO I. SABIHON, FELIPE G. SAGA, ANESIA D.
SALIN, FLAVIANO T. SALIN, JR., WENEFREDO T. SALIN, VIRGILIO B.
SALOMA, ESTELA S. SALVA, GEORGE R. SALVA, TEOFISTA R. SALVA,
JOSEPHINE T. SEDIGO, MICHAEL P. SEGISMAR, SR., JOSEPH S.
SEVILLA, MARISSA H. SIENES, MA. GINA M. SILVA, ARTURO T.
SOLITANA, MARILYN M. TABORA, GABINO G. TEMBLOR, REYNALDO Q.
TEMBLOR, ELSA A. TEVES, LEONORA D. TORCO, GREGORIA O.
TOROY, ANDRES P. TORRES, HILARIO P. TORRES, LEONARDO G.
TORRES, MANOLITA T. TORRES, GENEROSO I. TORRES, LEONARDO F.
TUBAGA, AGRIPINO P.TURCO, FLORDELICO S. VERBO, OLYMPIA T.
YORONG and ROSENDA C. ZERNA, petitioners,
vs.
POLO COCONUT PLANTATION CO., INC., FLORENCIA D. REMOLLO,
NOLE C. ALCANTARA, ZOSIMO BARBA, ROBERT B.
BAJANA,6 EMETERIO V. TAG-AT, JUVENAL T. MENDEZ, SHIELA R.
REYES, JONITA M. CADALLO, PRISCO P. BACO, BENJAMIN C. DAYAP,
ANTONIO DEDELES, NARCISO D. DIAZ, JOVENIANO REYES, RODOLFO
C. SALVA, AVELINO C. BAJANA, PRAXEDES BAJANA, ALEJANDRO T.
GIMOL, MELINA B. SEDIGO and HERMINIGILDO
VILLAFLORES, respondents.

DECISION

CORONA, J.:

In the late 1990s, respondent Polo Coconut Plantation Co., Inc. (PCPCI)
sought to convert 280 hectares of its Polo Coconut Plantation7 (Polo estate) in
Tanjay, Negros Oriental into a special economic zone (ecozone) under the
Philippine Economic Zone Authority (PEZA). On December 19, 1998, PEZA
issued Resolution No. 98-320 favorably recommending the conversion of the
Polo estate into an ecozone8 subject to certain terms and conditions including
the submission of "all government clearances, endorsements and documents
required under Rule IV, Section 3 of the Rules and Regulations to Implement
Republic Act (RA) 7916."

The following year, PCPCI applied for the reclassification of its agricultural
lands into mixed residential, commercial and industrial lands with the
municipal government of Tanjay. After conducting the prescribed hearing,
the Sangguniang Bayan of Tanjay adopted Resolution No. 344 granting
PCPCI's application on November 3, 1999.

When Tanjay became a city, its Sangguniang Panglungsod adopted


Resolution No. 16 approving Tanjay's Comprehensive Land Use Plan and
Zoning Ordinance where PCPCI's real properties, including the Polo estate,
were reclassified as mixed residential, commercial and industrial lands.9

Sometime in 2003, petitioner Department of Agrarian Reform (DAR), through


Provincial Agrarian Reform Officer Stephen M. Leonidas, notified PCPCI that
394.9020 hectares of the Polo estate had been placed under the
Comprehensive Agrarian Reform Program (CARP)10 and would be acquired
by the government.
Thereafter, Leonidas requested the Registrar of Deeds of Negros Oriental to
cancel PCPCI's certificate of title and to issue a new one in the name of the
Republic of the Philippines. He likewise asked Region VII Regional Agrarian
Reform Adjudicator Arnold C. Arrieta to determine the just compensation due
to PCPCI.11

On January 29, 2004, a new certificate of title was issued in the name of the
Republic of the Philippines.12 The next day, that title was cancelled and
another was issued in the name of petitioners in G.R. No. 169271 (petitioners-
beneficiaries).13

Meanwhile, on March 11, 2004, Arrieta approved the land valuation


(P85,491,784.60)14 of the Land Bank of the Philippines for the Polo estate.
PCPCI moved for reconsideration but it was denied in an order dated March
30, 2004.

On July 16, 2004, Leonidas informed PCPCI that a relocation survey of the
Polo estate would be conducted. PCPCI moved for the suspension of the
survey but it was denied.15

Aggrieved, PCPCI filed a petition for certiorari16 in the Court of Appeals (CA)
asserting that the DAR acted with grave abuse of discretion in placing the
Polo estate under the CARP. It argued that the Polo estate should not be
subjected to the CARP because Resolution No. 16 had already designated it
as mixed residential, commercial and industrial land. Moreover, petitioners-
beneficiaries were not qualified to receive land under the CARP.

In its February 16, 2005 decision, the CA found that the Polo estate was no
longer agricultural land when the DAR placed it under the CARP in view of
Resolution No. 16. Furthermore, petitioners-beneficiaries were not qualified
beneficiaries as they were not tenants of PCPCI. Thus:

WHEREFORE, in view of the foregoing premises, judgment is hereby


rendered by usDECLARING as NOT VALID the acts of the [DAR] of
subjecting PCPCI's [Polo estate] to the coverage of the CARP, of
canceling and causing the cancellation of [PCPCI's] Transfer Certificate
of Title No. T-2304 covering such land, of issuing or causing the
issuance of Transfer Certificate of Title No. T-36318 for this land in the
name of the Republic of the Philippines by way of transfer to it, of
issuing or causing the issuance of Transfer Certificate of Title No. T-802
for the said land in the names of [petitioner-beneficiaries] in the case at
bench by way of award of them of such land as purported farm
beneficiaries and of doing other things with the end in view of subjecting
[the Polo estate] to CARP coverage, SETTING
ASIDE andENJOINING such acts and the consequence
thereof, ORDERING the [petitioner-beneficiaries] to vacate the premises
of [the Polo estate] if they had entered such premises,
and ORDERINGthe respondent Register of Deeds of Negros Oriental to
cancel Transfer Certificate of Title Nos. T-36318 and T-802 and to
reinstate Transfer Certificate of Title No. T-2304 in the name of petitioner
PCPCI.

SO ORDERED.17

Both the DAR and petitioners-beneficiaries moved for reconsideration but they
were denied.18Hence, this recourse.

The DAR asserts that the reclassification of the Polo estate under Resolution
No. 16 as mixed residential, commercial and industrial land did not place it
beyond the reach of the CARP. Petitioners-beneficiaries, on the other hand,
insist that they were qualified beneficiaries. While they were neither farmers
nor regular farmworkers of PCPCI, they were either seasonal or other
farmworkers.

There is merit in these petitions.

Non-Exhaustion of
Administrative Remedies

Recourse to court action will not prosper until all remedies have been
exhausted at the administrative level.19

Section 3, Rule II of the 2003 DARAB Rules of Procedure (DARAB Rules)


provides:
Section 3. Agrarian Law Implementation Cases. The Adjudicator or
Board shall have no jurisdiction over matters involving the
implementation of RA 6657 otherwise known as the Comprehensive
Agrarian Reform Law (CARL) of 1988 and other related agrarian laws
enunciated by pertinent rules and administrative orders, which shall be
under the exclusive prerogative of and cognizable by the Office of
the Secretary of the DAR in accordance with his issuances to wit:

3.1. Classification and identification of landholdings for coverage


under the agrarian reform program and the initial issuance of
[certificates of land ownership award] and [emancipation patents],
including protests or oppositions thereto and petitioners for lifting
of such coverage;

3.2. Classification, identification, inclusion, exclusion, qualification


or disqualification of potential/actual farmer/beneficiaries;
(emphasis supplied)

xxx xxx xxx

Protests regarding the implementation of the CARP fall under the exclusive
jurisdiction of the DAR Secretary. He determines whether a tract of land is
covered by or exempt from CARP.20 Likewise, questions regarding the
eligibility of CARP beneficiaries must be addressed to him. The DAR
Secretary decides to whom lands placed under the CARP shall be
distributed.21

Before PCPCI filed its petition for certiorari in the CA, it did not file a protest or
opposition questioning the propriety of subjecting the Polo estate to the CARP.
Neither did it assail the eligibility of petitioners-beneficiaries before the DAR
Secretary. There were available administrative remedies under the DARAB
Rules but PCPCI did not avail of them.

Moreover, a special civil action for certiorari under Rule 65 of the Rules of
Court can be availed of only in the absence of an appeal or any plain, speedy
and adequate remedy in the ordinary course of law.22 Here, recourse to the
DAR Secretary was the plain, speedy and adequate remedy in the ordinary
course of law contemplated by Rule 65.

Non-Conversion To Mixed
Residential, Commercial and
Industrial Land

In Ros v. DAR,23 we held that reclassified agricultural lands must undergo the
process of conversion in the DAR24 before they may be used for other
purposes.25 Since the DAR never approved the conversion of the Polo estate
from agricultural to another use, the land was never placed beyond the scope
of the CARP.

The approval of the DAR for the conversion of agricultural land into an
industrial estate is a condition precedent for its conversion into an
ecozone.26 A proposed ecozone cannot be considered for Presidential
Proclamation unless the landowner first submits to PEZA a land use
conversion clearance certificate from the DAR.27 This PCPCI failed to do.

PEZA Resolution No. 98-320 expressly provides:

Resolved, that the application of [PCPCI] for (1) declaration of the 280-
hectare property in Brgy. Polo, Municipality of Tanjay, Province of
Negros Oriental as a Special Economic Zone, subject to Presidential
Proclamation, henceforth to be to be known as POLO ECOCITY-
SPECIAL ECONOMIC ZONE and (2) registration as the
Developer/Owner of the said ECOZONE is hereby APPROVED subject
to the following terms and conditions:

xxx xxx xxx

2. Prior to PEZA's endorsement of the subject area to the President for


proclamation as an ECOZONE, the PCPCI shall submit all government
clearances, endorsements and documents required under Rule IV,
Section 3 of the [Rules and Regulations to Implement RA 7916];

xxx xxx xxx


This condition proves that the favorable recommendation of PEZA did not ipso
facto change the nature of the Polo estate. The property remained as
agricultural land and, for this reason, was still subject to the CARP.

In fact, Resolution No. 16 did not exempt PCPCI's agricultural lands (including
the Polo estate) from the CARP. Section 20 of the Local Government
Code28 provides that a city or municipality can reclassify land only through the
enactment of an ordinance. In this instance, reclassification was undertaken
by mere resolution;29 thus, it was invalid.

Qualification Of CARP
Beneficiaries

Section 22 of the CARL provides:

Section 22. Qualified Beneficiaries. - The lands covered by the CARP


shall be distributed as much as possible to landless residents of the
same baranggay, 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 abovementioned beneficiaries


and

(g) others directly working on the land.

xxx xxx xxx

A basic qualification of a beneficiary is his willingness, aptitude and


ability to cultivate and make the land as productive as possible. The
DAR shall adopt a system of monitoring the record or performance of
each beneficiary, so that any beneficiary guilty of negligence or misuse
of the land or any support extended to him shall forfeit his right to
continue as such beneficiary. The DAR shall submit periodic reports on
the performance of the beneficiaries to the [Presidential Agrarian
Reform Council].

xxx xxx xxx

This provision enumerates who are qualified beneficiaries of the CARP.


Determining whether or not one is eligible to receive land involves the
administrative implementation of the program. For this reason, only the DAR
Secretary can identify and select CARP beneficiaries. Thus, courts cannot
substitute their judgment unless there is a clear showing of grave abuse of
discretion.30

Section 22 of the CARL does not limit qualified beneficiaries to tenants of the
landowners. Thus, the DAR cannot be deemed to have committed grave
abuse of discretion simply because its chosen beneficiaries were not tenants
of PCPCI.

WHEREFORE, the petitions are hereby GRANTED. The February 16, 2005
decision and June 29, 2005 resolution of the Court of Appeals in CA-G.R.
CEB-SP No. 00043 are REVERSED and SET ASIDE.

The March 11, 2004, March 30, 2004 and August 30, 2004 orders of Region
VII Regional Agrarian Reform Adjudicator Arnold C. Arrieta in RARAD Case
No. VII-N-1284-2004 are REINSTATED. Transfer Certificate of Title No. T-802
and Certificate of Land Ownership Award No. 00114438 are declared VALID.

SO ORDERED.

G.R. No. 140717 April 16, 2009

ANNIE L. MANUBAY, ANNE MARIE L. MANUBAY, JAMES JOHN L.


MANUBAY, JAMES FRANCIS L. MANUBAY, ANNE MARGARETH L.
MANUBAY and MANUBAY AGRO-INDUSTRIAL DEVELOPMENT CORP., INC.
represented by ATTY. JAIME A. MANUBAY, Petitioners,
vs.
HON. ERNESTO D. GARILAO, in his capacity as the Secretary of the
Department of Agrarian Reform,Respondent.

RESOLUTION

CORONA, J.:

At the heart of this controversy is a 124-hectare land in Barrio Cadlan, Pili,


Camarines Sur owned by petitioners Annie, Anne Marie, James John, James
Francis and Anne Margareth (all surnamed Manubay)1 and Manubay Agro-
Industrial Development Corporation.2

On November 15, 1994, the Municipal Agrarian Reform Officer (MARO) of Pili
issued a notice of coverage placing the property under the comprehensive
agrarian reform program (CARP).3 Petitioners did not protest the notice.

On July 1, 1996, petitioners filed an application at the Department of Agrarian


Reform (DAR) for conversion of the property from agricultural to residential.4

On August 26, 1996, the Sangguniang Bayan of Pili passed Resolution No. 145
approving the Comprehensive Zoning Ordinance of 1996 of the Municipality of
Pili, Camarines Sur.5 The ordinance reclassified the subject property from
agricultural to highly urbanized intended for mixed residential and commercial
use.6

Thereafter, petitioners requested DAR Regional Director Percival C. Dalugdug to


set aside the November 15, 1994 notice of coverage. They pointed out that the
land had been reclassified and the property was no longer suitable for
agricultural purposes. Director Dalugdug denied their request in a letter dated
November 13, 19967 :

Relative to land conversions, we are guided in our actions by [DAR-


Administrative Order (AO)] No. 12, s. 1994 which clearly states that no
application for conversions shall be accepted on lands for compulsory
acquisition already given notices of coverage. Applications may only be
accepted if the notice of coverage has been lifted for one reason or another.

xxxxxxxxx
Please note that your properties have already been issued notices of coverage
by the MARO of Pili last November 15, 1994 which is almost two years prior to
your submission of the application for conversion. To reiterate, for us to
entertain your application, you must first have these notices lifted whether
because of retention or exemption. Since the basis of your claims of
exemption (i.e., not yet covered per instruction by the Secretary, and
reclassification under the Pili land use plan) are not valid, we are sorry to inform
you that we can no longer entertain your application. (emphasis supplied)

Respondent Ernesto Garilao, then DAR Secretary, upheld Director Dalugdug and
denied petitioners application for conversion, considering that the property had
already been placed under the CARP.8

Aggrieved, petitioners separately asked respondent to reconsider. They insisted


that, because the MARO issued a notice of coverage, not a notice of acquisition,
their application for conversion should have been approved. The motions were
denied.9

On April 28, 1998, petitioners filed a petition for certiorari in the Court of Appeals
(CA) assailing the denial of their application for conversion.10 They averred that
respondent acted with grave abuse of discretion when he denied their
application. According to them, the issuance of a mere notice of coverage placing
agricultural land under the CARP was not a ground for the denial of such
application.

In a resolution dated June 1, 1999, the CA dismissed the petition.11 DAR-AO No.
7, s. 199712 provides that the decision of the DAR Secretary may be appealed
either to the Office of the President (OP) or to the CA. Considering that the issue
raised by petitioners involved the administrative implementation of the CARP, the
OP was more competent to rule on the issue. Moreover, by failing to bring the
matter to the said office, petitioner did not exhaust all available administrative
remedies before resorting to a petition for certiorari.

Petitioners moved for reconsideration but it was denied.13 Hence, this recourse.

Petitioners contend that the CA erred in dismissing the petition for certiorari as
they did not violate the rule on exhaustion of administrative remedies. The act of
a department secretary may be directly challenged in a petition for certiorari.
We dismiss the petition.

Under the doctrine of qualified political agency, department secretaries are alter
egos or assistants of the President and their acts are presumed to be those of
the latter unless disapproved or reprobated by him.14 Thus, as a rule, an
aggrieved party affected by the decision of a cabinet secretary need not appeal
to the OP and may file a petition for certiorari directly in the Court of Appeals
assailing the act of the said secretary.15

Section 1 of Rule 65 of the Rules of Court provides that, for a petition for
certiorari to prosper, petitioner must show (1) the public respondent acted without
or in excess of his jurisdiction or with grave abuse of discretion amounting to lack
or excess of jurisdiction and (2) there is no appeal or a plain, speedy and
adequate remedy in the ordinary course of law.

In a petition for certiorari premised on grave abuse of discretion, it must be


shown that public respondent patently and grossly abused his discretion and that
such abuse amounted to an evasion of positive duty or a virtual refusal to
perform a duty enjoined by law or to act at all in contemplation of law. In other
words, the public respondent exercised his power arbitrarily and despotically by
reason of passion or hostility.16

Here, inasmuch as respondent had a valid ground to deny petitioners


application, he did not commit grave abuse of discretion. 1avvphi1

Furthermore, DAR-AO No. 7, s. 1997 requires an appeal (of the denial of


application of conversion) to the OP. It was the plain, speedy and adequate
remedy contemplated by Section 1 of Rule 65.

Needless to state, elevating the matter to the OP was consistent with the doctrine
of exhaustion of administrative remedies. A party aggrieved by an order of an
administrative official should first appeal to the higher administrative authority
before seeking judicial relief. Otherwise, as in this case, the complaint will be
dismissed for being premature or for having no cause of action.17

WHEREFORE, the June 1, 1999 and November 4, 1999 resolutions of the Court
of Appeals in CA-G.R. SP No. 47244 are hereby AFFIRMED.

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