tenancy

LECTURE GUIDE of

Assistant Secretary AUGUSTO P. QUIJANO
Department of Agrarian Reform

1. Discuss the requisites for the existence of tenancy relations:

a) The parties are the landholder and the tenant;
b) The subject is agricultural land;
c) There is consent by the landholder for the tenant to work on the land, given either orally or in writing, expressly or impliedly;
d) The purpose is agricultural production;
e) There is personal cultivation or with the help of the immediate farm household; and
f) There is compensation in terms of payment of a fixed amount in money and/or produce.
(Caballes vs. DAR, 168 SCRA 254 [1988]; Gabriel vs. Pangilinan, 58 SCRA 590 (1974); Oarde vs. CA, 280 SCRA 235, [1997]; Qua vs. CA, 198 SCRA 236 [1991].

AGRICULTURAL LEASEHOLD
TENANCY
CIVIL LAW LEASE

As to Subject Matter

limited to agricultural land

refer to rural or urban property
As to Attention and Cultivation

leasehold tenant should personally attend to, and cultivate the agricultural land

lessee need not personally cultivate or work the thing leased;

As to Purpose

the landholding is devoted to agriculture

the purpose may be for any other lawful pursuits
As to Law governing the relationship

Governed by special law (RA 3844 as amended by RA 6389).

Governed by the Civil Code

2.

Source: Gabriel vs. Pangilinan, 58 SCRA 590 (1974)

3. An overseer of a coconut plantation was not considered a tenant (Zamoras vs. Su, Jr., 184 SCRA 248 (1990); Castillo vs. CA, 205 SCRA 529 (1992).

4. The owner tilling his own agricultural land is not a tenant within the contemplation of law. (Baranda vs. Baguio, 189 SCRA 197 (1990).

5. Certification of tenancy/non-tenancy issued by DAR are not conclusive evidence of tenancy relationship. (Oarde vs. CA et al., 280 SCRA 235 [1997]).

6. Successor-in-interest of the true and lawful landholder/owner who gave the consent are bound to recognize the tenancy established before they acquired the agricultural land (Endaya vs. CA, 215 SCRA 109 [1992]).

7. The law is explicit in requiring the tenant and his immediate family to work on the land (Bonifacio vs. Dizon; 177 SCRA 294), and the lessee cannot hire many persons to help him cultivate the land (De Jesus vs. IAC, 175 SCRA 559).

8. “We agree with the trial court that We cannot have a case where a landlord is divested of his landholding and somebody else is installed to became a new landlord.” (Oarde, et al., vs. CA, et al., 780 SCRA 235 [1997]).

9. Tenancy relation was severed when the tenant and/or his immediate farm household ceased from personally working the fishpond (Gabriel vs. Pangilinan, 58 SCRA 590 (1974).

10. Since there is no sharing arrangement between the parties, the Court held that Matienzo is merely an overseer and not a tenant (Matienzo vs. Servidad, 107 SCRA 276 (1981).

11. The Supreme Court has consistently ruled that once a leasehold relation has been established, the agricultural lessee is entitled to security of tenure. The tenant has a right to continue working on the land except when he is ejected therefrom for cause as provided by law (De Jesus vs. IAC, 175 SCRA 559 (1989).

12. Security of tenure is a legal concession to agricultural lessees which they value as life itself and deprivation of their landholdings is tantamount to deprivation of their only means of livelihood. (Bernardo vs. Court of Appeals, 168 SCRA 439 (1988).

13. Security of tenure afforded the tenant-lessee is constitutional (Primero vs. CIR, 101 Phil. 675 (1957); Pineda vs. de Guzman, 21 SCRA 1450 (1967) Once a tenant, always a tenant.

14. The Supreme Court held that only the tenant-lessee has a right to a homelot and that members of the immediate family of the tenant are not entitled to a homelot (Cecilleville Realty and Service Corporation vs. CA, 278 SCRA 819 (1997).

15. Causes for Termination of the Leasehold Relation

a) Abandonment of the landholding without the knowledge of the agricultural lessor (Teodoro vs. Macaraeg, 27 SCRA 7 (1969);

b) Voluntary surrender of the landholding by the agricultural lessee, written notice of which shall be served three months in advance (Nisnisan, et al., vs. CA, 294 SCRA 173 (1998); or

c) Absence of an heir to succeed the lessee in the event of his/her death or permanent incapacity (Section 8, RA 3844)

16. The lessor who ejects his tenant without the court’s authorization shall be liable for:

a) Fine or imprisonment;
b) Damages suffered by the agricultural lessee in addition to the fine or imprisonment for unauthorized dispossession;
c) Payment of attorney’s fees incurred by the lessee; and
d) The reinstatement of the lessee.

17. The Supreme Court in upholding its constitutionality held that there is no legal basis for declaring LOI No. 474 void on its face on equal protection, due process and taking of property without just compensation grounds. (Zurbano vs. Estrella, 137 SCRA 333 (1989)

18. In the case of Locsin vs. Valenzuela which was promulgated on 19 February 1991, the Supreme Court explained the legal effect of land being place under OLT as vesting ownership in the tenant. However, in a subsequent case dated 13 September 1991 Vinzons Magana vs. Estrella citing Pagtalunan vs. Tamayo which pre-dated the Locsin case, the High Tribunal ruled that mere issuance of a certificate of land transfer does not vest ownership in the farmer/grantee.

19. The consent of the farmer-beneficiary is not needed in the determination of just compensation pursuant to Section 18 of RA No. 6657 (Land Bank of the Philippines vs. CA and Pascual (G.R. No. 128557, December 29, 1999).

20. “Just Compensation” is defined as the full and fair equivalent of the property taken from its owner by the expropriator. It has been repeatedly stressed by this Court, that the measure is not the taker’s gain but the owner’s loss. The word “just” is used to intensify the meaning of the word “compensation” to convey the idea that the equivalent to be rendered for the property to be taken shall be real, substantial, full and ample. (Association of Small Landowners in the Philippines, Inc. vs. Secretary of Agrarian Reform, 175 SCRA 343 (1989).

21. “It is error to think that, because of Rule XIII, Section II, the original and exclusive jurisdiction given to the courts to decide petition for determination of just compensation has already been transformed into an appellate jurisdiction. It only means that, in accordance with settled principle of administrative law, primary jurisdiction is vested in the DAR as an administrative agency to determine in a preliminary manner the reasonable compensation to be paid for the lands taken under the CARP, but such determination is subject to challenge in the courts.

“The jurisdiction of the Regional Trial Courts is not any less “original and exclusive”, because the question is first passed upon by the DAR, as the judicial proceedings are not a continuation of the administrative determination. For the matter, the law may provide that the decision of the DAR is final and unappealable. Nevertheless, resort to courts cannot be foreclosed on the theory that courts are the guarantors of the legality of administrative action” (Phil. Veterans Bank vs. Court of Appeals G.R. No. 132767, January 18, 2000).

22. The Supreme Court decided not to apply that 6% increment to the valuation because the Court of Appeals affirmed the PARAD’s use of the 1992 Gross Selling Price in the valuation of the private respondent’s land (following the ruling in the Court of Appeals case of Galeon vs. Pastoral, CA-G.R. No. 23168; Rollo, p. 36) (LBP vs. CA and Jose Pascual, G.R. No. 128557, Dec. 29, 1999)

23. The DAR must first resolve the issues raised in a protest/application before the distribution of covered lands to farmer-beneficiaries may be effected. (Roxas & Co., Inc. vs Court of Appeals, G.R. 127876, 17 December, 1999).

24. The CREATION and JURISDICTION of the DARAB was discussed by the Supreme Court in the case of Machete vs. CA, 250 SCRA 176 (1995). The Supreme Court held that:

“Section 17 of EO 229 vested the DAR with quasi-judicial powers to determine and adjudicate agrarian reform matters as well as exclusive original jurisdiction over all matters involving implementation of agrarian reform except those following under the exclusive original jurisdiction of the Department of Agriculture and the Department of Environment and Natural Resources in accordance with law.

“Executive Order 129-A, while in the process of reorganizing and strengthening the DAR, created the Department of Agrarian Reform Adjudication Board (DARAB) to assume the powers and functions with respect to the adjudication of agrarian reform cases”. (Also Quismundo vs. CA, 201 SCRA 609 (1991).

25. In Ualat vs. Judge Ramos, 265 SCRA 345 (1996), complainant filed an administrative case against the respondent Judge for taking cognizance of the ILLEGAL DETAINER case filed by their landowner against them notwithstanding knowledge of previously filed DARAB case and the fact that the illegal detainer case falls within the exclusive jurisdiction of the DAR. Despite the separate affidavits of the complainants containing allegation of landlord-tenant relationship, the respondent judge took cognizance of the illegal detainer case. Knowledge of existing agrarian legislation and prevailing jurisprudence on the subject, together with an ordinary degree of prudence, would have prompted respondent Judge to refer the case to the DAR for preliminary determination of the parties relationship, as required by law.

However, DARAB has no jurisdiction with respect to agrarian matters involving the prosecution of all criminal offenses under RA 6657 and the determination of just compensation for landowners (Rep. Act No. 6657 (1988), Sec. 57). Jurisdiction over said matters are lodged with the Special Agrarian Courts (SACs). The Court of Appeals and Supreme Court maintain their appellate jurisdiction over agrarian cases decided by DARAB. (Vda. de Tangub vs. Ca, 191 SCRA 885 (1990).

26. DARAB’s Jurisdiction over Agrarian Disputes was also resolved in Central Mindanao University vs. DARAB, 215 SCRA 86.

27. “Agrarian dispute” refers to 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 RA 6657 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” (Isidro vs. CA, 228 SCRA 503 (1993).

28. In the case of Vda. de Areiola vs. Camarines Sur Reg. Agricultural School, et al., 110 SCRA 517 (1960), the Supreme Court explained the phrase “by a third party” in Section 21 of RA 1199 (Ejectment; Violation; Jurisdiction. ---“all cases involving the dispossession of a tenant by the landholder or by a third party - - -) The Supreme Court held that when no tenancy relationship between the contending parties exist, the Court of Agrarian Relations has no jurisdiction”, “The law governing agricultural tenancy, RA 1199 explains that tenancy relationship is a “juridical tie” which arises between a landholder and a tenant once they agree expressly or impliedly to undertake jointly the cultivation of land belonging to the former, etc.”

Necessarily, the law contemplated a legal relationship between landowner and tenant. This does not exist where one is owner or possessor and the other a squatter or deforciant.”

29. Section 57 of RA 6657 provides that the Special Agrarian Court (SACs) shall have original and exclusive jurisdiction over all petitions for the determination of just compensation and all criminal offenses. The Supreme held that “any effort to transfer the original and exclusive jurisdiction to the DAR Adjudicators and to convert the original jurisdiction of the RTCs into appellate jurisdiction would be contrary to Section 57 of RA 6657 and therefore would be void. (Republic vs. Court of Appeals, 758 SCRA 263 (1996).

30. “It should be stressed that the motion in Fortich were denied on the ground that the “win-win” resolution is void and has no legal effect because the decision approving the concession has already become final and executory. This is the ratio decidendi or reason of the decision. The statement that LGUs have authority to convert or reclassify agricultural lands without DAR approval is merely a dictum or expression of the individual views of the ponente or writer of the Resolution of August 19, 1997. It does not embody the Court’s determination and is not binding (Fortich, et al., vs. Corona, et al., G.R. No. 131457 (August 19, 1999).

31. Agricultural lands expropriated by LGUs pursuant to the power of eminent domain need not be subject of DAR conversion clearance prior to change in use. (Province of Camarines Sur vs. CA, 222 SCRA 173 (1993)

32. Respondent DARs failure to observe due process in the acquisition of petitioner’s landholding does not ipso facto give this Court the power to adjudicate over petitioners’ application for conversion of its haciendas from agricultural to non-agricultural. (Roxas vs. CA, G.R. No. 127876, (December 16, 1999)

33. The issue of ownership cannot be settled by the DARAB since it is definitely outside its jurisdiction. Whatever findings made by the DARAB regarding the ownership of the land are not conclusive to settle the matter. The issue of ownership shall be resolved in a separate proceedings before the appropriate trial court between the claimants thereof. (Jaime Morta, Sr., et al., vs. Jaime Occidental, et al., G. R. No. 123417, (June 10, 1999) (Note the Dissenting Opinion of Chief Justice Davide Jr.,) 34. P.D. No. 27, which implemented the Operation Land Transfer (OLT) program, covers tenanted rice or corn lands. The requisites for coverage under the OLT program are the following: (1) the land must be devoted to rice or corn crops: and (2) there must be a system of share crop or lease-tenancy obtaining therein. If either of these requisites is absent, the land is not covered under OLT. Hence, a landowner need not apply for retention where his ownership over the entire landholding is intact and undisturbed.

On the other hand, the requisites for the exercise by the landowner of his right of retention are the following: (1) the land must be devoted to rice or corn crops; (2) there must be a system of share-crop or lease tenancy obtaining therein; and (3) the size of the landholding must not exceed twenty-four (24) hectares or it could be more than twenty-four (24) hectares provided that at least seven (7) hectares thereof are covered lands and more than seven (7) hectares of it consist of “other agricultural lands.”

In the landmark case of Association of Small Landowners in the Phil., Inc. vs. Secretary of Agrarian Reform, we held that landowners who have not yet exercised their retention rights under P.D. No. 27 are entitled to the new retention rights under R.A. No. 6657. We disregarded the August 27, 1985 deadline imposed by DAR Administrative Order No. 1, series of 1985 on landowners covered by OLT. However, if a landowner filed his application for retention after August 27, 1985 but he had previously filed the sworn statements required by LOI Nos. 41, 45 and 52, he is still entitled to the retention limit of seven (7) hectares under P.D. No. 27. Otherwise, he is only entitled to retain five (5) hectares under R.A. No. 6657. (Eudosia Daez and/or Her Heirs presented by Edriano D. Daez, vs. The Hon. C.A. et. al., 325 SCRA 857).

35. Evidently, quasi-judicial agencies that have the power to cite persons for indirect contempt pursuant to Rule 71 of the Rules of Court can only do so by initiating them in the proper Regional Trial Court. It is not within their jurisdiction and competence to decide the indirect contempt cases. These matters are still within the province of the Regional Trial Courts. In the present case, the indirect contempt charge was filed, not with the Regional Trial Court, but with the PARAD, and it was the PARAD that cited Mr. Lorayes with indirect contempt (LBP vs. Severino Listana, Sr., G.R. No. 152611. (August 5, 2003)

There are only two ways a person can be charged with indirect contempt, namely, (1) though a verified petition; and (2) by order or formal charge initiated by the court MOTU PROPRIO.

36. We hold that our decision, declaring a petition for review as the proper mode of appeal from judgments of Special Agrarian Courts is a rule of procedure which affects substantive rights. If our ruling is given retroactive application, it will prejudice LBP’s right to appeal because pending appeals in the Court of Appeals will be dismissed outright in mere technicality thereby sacrificing the substantial merits thereof. It would be unjust to apply a new doctrine to a pending case involving a party who already invoked a contrary view and who acted in good faith thereon prior to the issuance of said doctrine. (Land Bank of the Philippines vs. Arlene de Leon, et al., G.R. No. 143275 (March 20, 2003)(Note: Sec. 60 in relation to Sec. 61 of R.A. 6657).

37. The Supreme Court ruled that ”if landowners are called to sacrifice in the interest of land reform, their acceptance of Land Bank bonds in payment of their agricultural lands, government lending institutions should share in the sacrifice by accepting the same Land Bank bonds at their face value (Ramirez vs. CA, 194 SCRA 81)

38. The Supreme Court granted the petition for mandamus seeking to compel respondent GSIS to accept Land Bank bonds at their face value as payment for a pre-existing obligation (Maddumba vs. GSIS, 182 SCRA 281).

39. It is the DARAB which has the authority to determine the initial valuation of lands involving agrarian reform although such valuation may only be considered preliminary as the final determination of just compensation is vested in the courts. (Land Bank of the Philippines vs. Court of Appeals, 321 SCRA 629).

40. Court applied the provisions of Republic Act 6657 to rice and corn lands when it upheld the constitutionality of the payment of just compensation for Presidential Decree 27 lands through the different modes stated in Sec. 18. R.A. 6657. (Land Bank of the Philippines vs. Court of Appeals, 321 SCRA 629).

41. Nothing contradictory between the provisions of Sec. 50, R.A. 6657 granting the Department of Agrarian Reform primary jurisdiction (administrative proceeding) to determine and adjudicate "agrarian reform matters" and exclusive original jurisdiction over "all matters involving the implementation of agrarian reform" which includes the determination of questions of just compensation, and the provisions of Sec. 57, R.A. 6657 granting Regional Trial Courts "original and exclusive jurisdiction” (judicial proceeding) over (1) all petitions for the determination of just compensation to landowner, and (2) prosecutions of criminal offenses under Republic Act No. 6657. (Philippine Veterans Bank vs. CA, 322 SCRA 139).

42. It is error to think that, because of Rule XIII, Sec. 11, the original and exclusive jurisdiction given to the courts to decide petitions for determination of just compensation has thereby been transformed into an appellate jurisdiction. (Philippine Veterans Bank vs. CA, 322 SCRA 139).

43. The jurisdiction of the Regional Trial Courts is not any less "original and exclusive" because the question is first passed upon by the DAR, as the judicial proceedings are not a continuation of the administrative determination. For that matter, the law may provide that the decision of the DAR is final and unappealable. Nevertheless, resort to the courts cannot be foreclosed on the theory that courts are the guarantors of the legality of administrative action. (Philippine Veterans Bank vs. CA, 322 SCRA 139).

44. In Vda. De Tangub vs. Court of Appeals, we held that the jurisdiction of the Department of Agrarian Reform is limited to the following: a) adjudication of all matters involving implementation of agrarian reform; b) resolution of agrarian conflicts and land-tenure related problems; and c) approval and disapproval of the conversion, restructuring or readjustment of agricultural lands into residential, commercial, industrial, and other non-agricultural uses. (Morta, Sr. vs. Occidental, 308 SCRA 167).

45. The findings of fact of the Court of Agrarian Relations, supported by substantial evidence, is well-nigh conclusive on an appellate tribunal. ( De Chavez vs. Zobel, 55 SCRA 26).

46. The promulgation of P.D. No. 27 by President Marcos in the exercise of his powers under martial law has already been sustained in Gonzales vs. Estrella and we find no reason to modify or reverse it on that issue. As for the power of President Aquino to promulgate Proc. No. 131 and E.O. Nos. 228 and 229, the same was authorized under Section 6 of the Transitory Provisions of the 1987 Constitution, quoted above. (Association of Small Landowners in the Philippines, Inc. vs. Secretary of Agrarian Reform, 175 SCRA 343).

47. That fund, as earlier noted, is itself being questioned on the ground that it does not conform to the requirements of a valid appropriation as specified in the Constitution. Clearly, however, Proc. No. 131 is not an appropriation measure even if it does provide for the creation of said fund, for that is not its principal purpose. An appropriation law is one the primary and specific purpose of which is to authorize the release of public funds from the treasury. The creation of the fund is only incidental to the main objective of the proclamation, which is agrarian reform. (Ibid.)

48. The argument of some of the petitioners that Proc. No. 131 and E.O. No. 229 should be invalidated because they do not provide for retention limits as required by Article XIII, Section 4, of the Constitution is no longer tenable. R.A. No. 6657 does provide for such limits now in Section 6 of the law, which in fact is one of its most controversial provisions. (Ibid.)

49. In other words, mandamus can issue to require action only but not specific action. Whenever a duty is imposed upon a public official and an unnecessary and unreasonable delay in the exercise of such duty occurs, if it is a clear duty imposed by law, the courts will intervene by the extraordinary legal remedy of mandamus to compel action. If the duty is purely discretionary, the courts by mandamus will require action only. (Ibid.)

50. With these assumptions, the Court hereby declares that the content and manner of the just compensation provided for in the afore-quoted Section 18 of the CARP Law is not violative of the Constitution. We do not mind admitting that a certain degree of pragmatism has influenced our decision on this issue, but after all this Court is not a cloistered institution removed from the realities and demands of society or oblivious as the rest of our people to see the goal of agrarian reform achieved at last after the frustrations and deprivations of our peasant masses during all these disappointing decades. We are aware that invalidation of the said section will result in the nullification of the entire program, killing the farmer's hopes even as they approach realization and resurrecting the spectre of discontent and dissent in the restless countryside. That is not in our view the intention of the Constitution, and that is not what we shall decree today. (Ibid.)

51. Accepting the theory that payment of the just compensation is not always required to be made fully in money, we find further that the proportion of cash payment to the other things of value constituting the total payment, as determined on the basis of the areas of the lands expropriated, is not unduly oppressive upon the landowner. It is noted that the smaller the land, the bigger the payment in money, primarily because the small landowner will be needing it more than the big landowners, who can afford a bigger balance in bonds and other things of value. No less importantly, the government financial instruments making up the balance of the payment are "negotiable at any time." The other modes, which are likewise available to the landowner at his option, are also not unreasonable because payment is made in shares of stock, LBP bonds, other properties or assets, tax credits, and other things of value equivalent to the amount of just compensation. (Ibid.)

52. The recognized rule, indeed, is that title to the property expropriated shall pass from the owner to the expropriator only upon full payment of the just compensation. Jurisprudence on this settled principle is consistent both here and in other democratic jurisdictions. (Ibid.) 53. CARP Law (R.A. 6657) is more liberal than those granted by P.D. No. 27 as to retention limits. (Ibid.)

54. The rule is settled that the jurisdiction of a court is determined by the statute in force at the time of the commencement of an action. There can be no question that at the time the complaints in CAR Cases Nos. 760-802-UP'78 and 806-810-UP'78 were filed, the RTC of Pangasinan had no jurisdiction over them pursuant to Section 12 (a) and (b) of P.D. No. 946 which is vested the then Court of Agrarian Relations with original exclusive jurisdiction over cases involving rights granted and obligations imposed by presidential issuances promulgated in relation to the agrarian reform program. However, when Batas Pambansa Blg. 129, otherwise known as the Judiciary Reorganization Act of 1980, took effect, the Courts of Agrarian Relations were integrated into the Regional Trial Courts and the jurisdiction of the former was vested in the latter courts. It can thus be seen that at the time Branch 46 of the RTC of Pangasinan dismissed the agrarian cases on 29 October 1985, Regional Trial Courts already had jurisdiction over agrarian disputes. The issue that logically crops up then is whether Batas Pambansa Blg. 129 automatically conferred upon the aforesaid Branch 46 jurisdiction over the subject agrarian cases considering that these cases were filed seven (7) years earlier at a time when only the Courts of Agrarian Relations had exclusive original jurisdiction over them. We rule that it did not, for such a defect is fatal. Besides, the grant of jurisdiction to the Regional Trial Courts over agrarian cases was not meant to have any retroactive effect. Batas Pambansa Blg. 129 does not provide for such retroactivity. The trial court did not then err in dismissing the cases. ( Tiongson vs. CA, 214 SCRA 197).

55. On 22 July 1987, the President of the Republic of the Philippines promulgated Executive Order (E.O.) No. 229 providing for the mechanisms for the implementation of the Comprehensive Agrarian Reform Program instituted by Proclamation No. 131 dated 22 July 1987. Section 17 thereof provides: "SEC. 17. Quasi-Judicial Powers of the DAR.- The DAR is hereby vested with quasi-judicial powers to determine and adjudicate agrarian reform matters, and shall have exclusive original jurisdiction over all matters involving implementation of agrarian reform, except those falling under the exclusive jurisdiction of the DENR and the Department of Agriculture (DA). x x x The decisions of the DAR may, in proper cases, be appealed to the Regional Trial Courts but shall be immediately executory notwithstanding such appeal." This provision not only repealed Section 12 (a) and (b) of B.P. Blg. 129. The above-quoted Section 17 of E.O. No. 229 was the governing law at the time the challenged decision was promulgated. Then, too, Section 50 of R.A. No. 6657, the Comprehensive Agrarian Reform Law, substantially reiterates said Section 17 while Sections 56 and 57 provide for the designation by this Court of at least one (1) branch of the Regional Trial Court in each province to act as a special agrarian court which shall have exclusive original jurisdiction only over petitions for the determination of just compensation and the prosecution of criminal offenses under said Act. (Tiongson vs. CA, 214 SCRA 197).

56. The constitutionality of P.D. No. 27 from which Letter of Instructions No. 474 and Memorandum Circular No. 11, Series of 1978 are derived, is now well settled.

More specifically, this Court also upheld the validity and constitutionality of Letter of Instructions No. 474 which directed then Secretary of Agrarian Reform Conrado Estrella to "undertake to place under the Land Transfer Program of the government pursuant to Presidential Decree No. 27, all tenanted rice/corn lands with areas of seven hectares or less belonging to landowners who own other agricultural lands of more than seven hectares in aggregate areas or lands used for residential, commercial, industrial or other urban purposes from which they derive adequate income to support themselves and their families". (Vinzons-Magana vs. Estrella, 201 SCRA 536).

57. It is settled that mandamus is not available to control discretion but not the discretion itself. The writ may issue to compel the exercise of discretion but not the discretion itself. Mandamus can require action only but not specific action where the act sought to be performed involves the exercise of discretion. (Sharp International Marketing vs. CA, 201 SCRA 299).

58. Actions for forfeiture of certificates of land transfer for failure to pay lease rentals for more than two (2) years fall within the original and exclusive jurisdiction of the Court of Agrarian Relations. (Curso vs. CA, 128 SCRA 567).

59. Referral of preliminary determination of rights of tenant-farmer and the landowner to Ministry of Agrarian Reform, not necessary, where tenancy relationship between the parties is admitted in the pleadings. ( Curso vs. CA, 128 SCRA 567).

60. Presidential Decree No. 816 imposes the sanction of forfeiture where the "agricultural lessee x x x deliberately refuses and/or continues to refuse to pay the rentals or amortization payments when they fall due for a period of two (2) years." Petitioners cannot be said to have deliberately refused to pay the lease rentals. They acted in accordance with the MAR Circular, which implements P.D. 816, and in good faith. Forfeiture of their Certificates of Land Transfer and of their farmholdings as decreed by the CAR and affirmed by the Appellate Court is thus unwarranted. (Curso vs. CA, 128 SCRa 567).

61. Under Section 73 of R.A. 6657, persons guilty of committing prohibited acts of forcible entry or illegal detainer do not qualify as beneficiaries and may not avail themselves of the rights and benefits of agrarian reform.

Any such person who knowingly and willfully violates the above provisions of the Act shall be punished with imprisonment or fine at the discretion of the Court. ( Central Mindanao University vs. DARAB, 215 SCRA 86).

62. The DARAB has no power to try, hear and adjudicate the case pending before it involving a portion of the CMU's titled school site, as the portion of the CMU land reservation ordered segregated is actually, directly and exclusively used and found by the school to be necessary for its purposes. There is no doubt that the DARAB has jurisdiction to try and decide any agrarian dispute in the implementation of the CARP.
An agrarian dispute is defined by the same law as any controversy relating to tenurial rights whether leasehold, tenancy stewardship or otherwise over lands devoted to agriculture. ( Central Mindanao University vs. DARAB, 215 SCRA 86).

63. Section 12 (a) and (b) of Presidential Decree No. 946 deemed repealed by Section 17 Executive Order No. 229.- The above quoted provision should be deemed to have repealed Section 12 (a) and (b) of Presidential Decree No. 946 which invested the then Courts of Agrarian Relations with the original exclusive jurisdiction over cases and questions involving rights granted and obligations imposed by presidential issuances promulgated in relation to the agrarian reform program. In 1980, upon the passage of Batas Pambansa Blg. 129, otherwise known as the Judiciary Reorganization Act, the courts of agrarian relations were integrated into the Regional Trial Courts and the jurisdiction of the former was vested in the latter courts. (Quismundo vs. CA, 201 SCRA 609).

64. The Department of Agrarian Reform is vested with quasi-judicial powers to determine and adjudicate agrarian reform matters as well as exclusive original jurisdiction over all matters involving 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.

Executive Order 129-A, while in the process of reorganizing and strengthening the DAR, created the Department of Agrarian Reform Adjudication Board (DARAB) to assume the powers and functions with respect to the adjudication of agrarian reform cases. (Machete vs. CA, 250 SCRA 176).

65. Section 56 of R.A. 6657 confers "special jurisdiction" on "Special Agrarian Courts," which are Regional trial Courts designated by this Court-at least one (1) branch within each province-to act as such. These Regional Trial Courts designated as Special Agrarian Courts have, according to Sec. 57 of the same law, original and exclusive jurisdiction over: (a) all petitions for the determination of just compensation to landowners, and (b) the prosecution of all criminal offenses under the Act. (Machete vs. CA, 250 SCRA 176).

66. The failure of tenants to pay back rentals pursuant to a leasehold contract is an issue which is exclusively cognizable by the DARAB and is clearly beyond the legal competence of the Regional Trial Courts to resolve. (Ibid.)

67. The doctrine of primary jurisdiction does not warrant a court to arrogate unto itself authority to resolve a controversy the jurisdiction over which is initially lodged with an administrative body of special competence.

The resolution by the DAR of the agrarian dispute is to the best advantage of the parties since it is in a better position to resolve agrarian disputes, being the administrative agency presumably possessing the necessary expertise on the matter. (Ibid.)

68. The DAR has original, exclusive jurisdiction over agrarian disputes, except on the aspects of (a) just compensation; and (b) criminal jurisdiction over which regular courts have jurisdiction. (Vda. De Tangub vs. CA, 191 SCRA 885).

69. Where there are no tenurial, leasehold, or any agrarian relations whatsoever between the parties that could bring a controversy under the ambit of the agrarian reform laws, the Department of Agrarian Reform Adjudication Board has no jurisdiction. (Heirs of the Late Herman Rey Santos vs. CA, 327 SCRA 293).

70. The CARETAKER of the land may be considered as the cultivator of the land and, hence, a tenant. (Latag vs. Banog, 16 SCRA 88).

71. The cultivator is necessarily tasked with duties that amount to cultivation. (COCOMA vs. CA, 164 SCRA 568).

72. There are no squatters in Agricultural lands. Squatters are only found in URBAN COMMUNITIES, not in RURAL AREAS. (On Presidential Decree No. 772- Illegal Squatting) (People vs. Echaves, 95 SCRA 663).

73. It bears noting that the Decision, which prescribed for Rule 42 as the correct mode of appeal from the decisions of the SAC, was promulgated by this Court only on 10 September 2002, while the Resolution of the motion for reconsideration of the said case giving it a prospective application was promulgated on 20 March 2003. Respondent appealed to the Court of Appeals on 31 July 1998 via ordinary appeal under Rule 41 of the Rules of Court. Though appeal under said rule is not the proper mode of appeal, said erroneous course of action cannot be blamed on respondent. It was of the belief that such recourse was the appropriate manner to questioned the decisions of the SAC. In Land Bank v. De Leon, we held:

On account of the absence of jurisprudence interpreting Sections 60 and 61 of RA 6657 regarding the proper way to appeal decisions of Special Agrarian Courts as well as the conflicting decisions of the Court of Appeals thereon, LBP cannot be blamed for availing of the wrong mode. Based on its own interpretation and reliance on the Buenaventura ruling, LBP acted on the mistaken belief that an ordinary appeal is the appropriate manner to question decisions of Special Agrarian Courts.

Thus, while the rule is that the appropriate mode of appeal from the decisions of the SAC is through petition for review under Rule 42, the same rule is inapplicable in the instant case. The Resolution categorically stated that said ruling shall apply only to those cases appealed after 20 March 2003 (Fernando Gabatin, et al., vs. LBP, G.R. No. 148223, November 25 2004)

74. The foregoing clearly shows that there would never be a judicial determination of just compensation absent respondent Land Bank’s participation. Logically, it follows that respondent is an indispensable party in an action for the determination of just compensation in cases arising from agrarian reform program.

Assuming arguendo that respondent is not an indispensable party but only a necessary party as is being imposed upon us by the petitioners, we find the argument of the petitioners that only indispensable can appeal to be incorrect.

There is nothing in the Rules of Court that prohibit a party in an action before the lower court to make an appeal merely on the ground that he is not an indispensable party. The Rules of Court does not distinguish whether the appellant is an indispensable party or not. To avail of the remedy, the only requirement is that the persons appealing must have a present interest in the subject matter of the litigation and must be aggrieved or prejudiced by the judgment. A party, in turn, is deemed aggrieved or prejudiced when his interest, recognized by law in the subject matter of the lawsuit, is injuriously affected by the judgment, order or decree. The fact that a person is made a party to a case before the lower court, and eventually be made liable if the judgment be against him, necessarily entitles him to exercise his right to appeal. To prohibit such party to appeal is nothing less than an outright violation of the rules on fair play.

75. The Rules of Court provides that parties in interest without whom no final determination can be had of an action shall be joined either as plaintiffs or defendants. In BPI v. Court of Appeal, 402 SCRA 449 this Court explained:
. . . . . . An indispensable party is one whose interest will be affected by the court’s action in the litigation, and without whom no final determination of the case can be had. The party’s interest in the subject matter of the suit and in the relief sought are so inextricably intertwined with the other parties that his legal presence as a party to the proceeding is an absolute necessity. In his absence there cannot be resolution of the dispute of the parties before the court which is effective, complete, or equitable.

Conversely, a party is not indispensable to the suit if his interest in the controversy or subject matter is distinct and divisible from the interest of the other parties and will not necessarily be prejudiced by a judgment which does complete justice to the parties in court. He is not indispensable if his presence would merely permit complete relief between him and those already parties to the action or will simply avoid multiple litigation. (Ibid)

76. In Sharp International Marketing v. Court of Appeals, this Court even went on to say that without the Land Bank, there would be no amount to be established by the government for the payment of just compensation, thus:

As may be gleaned very clearly from EO 229, the LBP is an essential part of the government sector with regard to the payment of compensation to the landowner. It is, after all, the instrumentality that is charged with the disbursement of public funds for purposes of agrarian reform. It is therefore part, an indispensable cog, in the government machinery that fixes and determines the amount compensable to the landowner. Were LBP to be excluded from that intricate, if not sensitive, function of establishing the compensable amount, there would be no amount “to be established by the government” as required in Section 6 of EO 229 (emphasis. supplied). (Ibid)

77. We must stress, at the outset, that the taking of private lands under the agrarian reform program partakes of the nature of an expropriation proceeding. In a number of cases, we have stated that in computing the just compensation for expropriating proceedings, it is the value of the land at the time of the taking not at the time of the rendition of judgment, which should be taken into consideration. This being do, then in determining the value of the land for the payment of just compensation, the time of taking should be the basis. In the instant case, since the dispute over the valuation of the land depends on the rate of the GSP used in the equation, it necessarily follows that the GSP should be pegged at the time of the taking of the properties.

In the instant case, the said taking of the properties was deemed effected on 21 October 1972, when the petitioners were deprived of ownership over their lands in favor of qualified beneficiaries, pursuant to E.O. No. 228 and by the virtue of P.D. No. 27. The GSP for one cavan of palay at that time was at P35. Prescinding from the foregoing discussion, the GSP should be fixed at said rate, which was the GSP at the time of the taking of the subject property . (Ibid)

78. Petitioners are not rendered disadvantage by the computation inasmuch as they are entitled to receive the increment of six percent (6%) yearly interest compounded annually pursuant to DAR Administrative Order No. 13, Series of 1994. As amply explained by this Court:

The purpose of AO No. 13 is to compensate the landowners for unearned interests. Had they been paid in 1972 when the GSP for rice and corn was valued at P35.00 and P31.00, respectively, and such amounts were deposited in a bank, they would have earned a compounded interest of 6% per annum. Thus, if the PARAD used the 1972 GSP, then the product of (2.5 x AGP x P35.00 or P31.00) could be multiplied by (1.06) to determine the value of the land plus the addition 6% compounded interest it would have earned from 1972.

79. Petitioner’s reliance on Land Bank v. Court of Appeals where we ordered Land Bank to pay the just compensation based on the GSP at the time the PARAD rendered the decision, and not at the time of the taking, is not well taken. In that case, PARAD, in its decision, used the GSP at the time of payment, in determining the land value. When the decision became final and executory, Land Bank, however, refused to pay the landowner arguing that the PARAD’s valuation was null and void for want of jurisdiction. We rules therein that the PARAD has the authority to determine the initial valuation of lands involving agrarian reform. Thus, the decision of the PARAD was binding on Land Bank. Land Bank was estopped from questioning the land valuation made by PARAD because it participated in the valuation proceedings and did not appeal the said decision. Hence, Land Bank was compelled to pay the land value based on the GSP at the time of payment. (Ibid)

80. As can clearly be gleaned from the foregoing provision, the remedy of relief from judgment can only be resorted to on grounds of fraud, accident, mistake or excusable negligence. Negligence to be excusable must be one which ordinary diligence and prudence could not have guarded against.

Measured against this standard, the reason proferred by Land Bank’s counsel, i.e., that his heavy workload prevented him from ensuring that the motion for reconsideration included a notice of hearing, was by no means excusable.

Indeed, counsel’s admission that “he simply scanned and signed the Motion for Reconsideration for Agrarian Case No. 2005, Regional Trial Court of Pampanga, Branch 48, not knowing, or unmindful that it had no notice of hearing” speaks volumes of his arrant negligence, and cannot in any manner be deemed to constitute excusable negligence. (LBP vs. Hon. Elis G.C. Natividad G.R. No. 127198, May 16, 2005).

81. Indeed, a motion that does not contain the requisite notice of hearing is nothing but a mere scrap of paper. The clerk of court does not have the duty to accept it, much less to bring it to the attention of the presiding judge. The trial court therefore correctly considered the motion for reconsideration pro forma. Thus, it cannot be faulted for denying Land Bank’s motion for reconsideration and petition for relief from judgment. (Ibid)

82. At any rate, in the Philippines Veterans Bank v. Court of Appeals, We declare that there is nothing contradictory between the DAR’s primary jurisdiction to determine and adjudicate agrarian reform matters and exclusive original jurisdiction over all matters involving the implementation of agrarian reform, which includes jurisdiction of regional trial courts over all petitions for the determination of just compensation. The first refers to administrative proceedings, while the second refers to judicial proceedings.

In accordance with settled principles of administrative law, primary jurisdiction is vested in the DAR to determine in a preliminary manner the just compensation for the lands taken under the agrarian reform program, but such determination is subject to challenged before the courts. The resolution of just compensation cases for the taking of lands under agrarian reform is, after all, essentially a judicial function.

83. Land Bank’s contention that the property was acquired for purposes of agrarian reform on October 21, 1972, the time of the effectivity of PD 27, ergo just compensation should be based on the value of the property as of that time and not at the time of possession in 1993, is likewise erroneous. In Office of the President, Malacañang, Manila v. Court of Appeals, we ruled that the seizure of the landholding did not take place on the date of effectivity of PD 27 but would take effect on the payment of just compensation.

Under the factual circumstances of this case, the agrarian reform process is still incomplete as the just compensation to be paid private respondents has yet to be settled. Considering the passage of Republic Act No. 6657 (RA 6657) before the completion of this process, the just compensation should be determined and the process concluded under the said law. Indeed, RA 6657 is the applicable law, with PD 27 and EO 228 having only suppletory effect, conformably with our ruling in Paris v. Alfeche. (Ibid)

84. It would certainly be inequitable to determine just compensation on the guideline provided by PD 27 and EO 228 considering the DAR’s failure to determine the just compensation for a considerable length of time. That just compensation should be determined in accordance with RA 6657, and not PD 27 or EO 228, is especially imperative considering that just condensation should be the full and fair equivalent of the property taken from its owner by the expropriator, the equivalent being real, substantial, full and ample.

85. All controversies on the implementation of the Comprehensive Agrarian Reform Program (CARP) fall under the jurisdiction of the Department of Agrarian Reform (DAR), even through they raise questions that are also legal or constitutional in nature. All doubts should be resolved in favor of the DAR, since the law has granted it special and original authority to hear and adjudicate agrarian matter. (DAR vs. Roberto J. Cuenca and Hon. Alfonso B. Combong, Jr., et al. G.R. N. 154112, September 23, 2004).

86. In view of the foregoing, there is no need to address the other points pleaded by respondent in relation to the jurisdictional issue. We need only to point that in case of doubt, the jurisprudential trend is for courts to refrain from resolving a controversy involving matters that demand the special competence of administrative agencies, “even if the question[s] involved [are] also judicial in character, as in this case. (Ibid)

87. Having declared the RTCs to be without jurisdiction over the instant case, it follows that the RTC of La Carlota City (Branch 63) was devoid of authority to issue the assailed Writ of Preliminary Injunction. That Writ must perforce be stricken down as a nullity. Such nullity is particularly true in the light of the express prohibitory provisions of the CARP and this Court’s Administrative Circular Nos. 29-2002 and 38-2002. These Circulars enjoin all trial judges to strictly observe Section 68 of RA 6657, which reads:

“Section 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.”(Ibid)

88. It is a well-settled rule that only questions of law may be received by the Supreme Court in an appeal by certiorari. Findings of fact by the Court of Appeals are final and conclusive and cannot be reviewed on appeal to the Supreme Court.

The only time this Court will disregard the factual findings of the Court of Appeals (which are ordinary accorded great respect) is when these are based on speculation, surmises or conjectures or when these are not based on substantial evidence. (Samahan ng Magsasaka San Jose represented by Dominador Maglalang vs. Marietta Valisno, et al., G.R. No. 158314 June 3, 2004).

89. The relevant laws governing the minors’ redemption in 1973 are the general Civil Code provisions on legal capacity to enter into contractual relations. Article 1327 of the Civil Code provides that minors are incapable of giving consent to a contract. Article 1390 provides that a contract where one of the parties is incapable of giving consent is viodable or annullable. Thus, the redemption made by the minors in 1973 was merely voidable or annullable, and was not void ab initio, as petitions argue.

Any action for the annulment of the contracts thus entered into by the minors would require that: (1) the plaintiffs must have an interest in the contract; and (2) the action must be brought by the victim and not the party responsible for the defect. Thus, Article 1397 of the Civil Code provides in part that “[t]he action for the annulment of contracts may be instituted by all who are thereby obliged principally or subsidiarily. However, persons who are capable cannot allege the incapacity of those with whom they contracted.” The action to annul the minors’ redemption in 1973, therefore, was one that could only have been initiated by the minors themselves, as the victims or the aggrieved parties in whom the law itself vests the right to file suit. This action was never initiated by the minors. We thus quote with approval the ratiocination of the Court of Appeals:

Respondent contend that the redemption made by the petitioners was simulated, calculated to avoid the effects of agrarian reform considering that at the time of redemption the latter were still minors and could not have recourse, in their own right, to pay the price thereof.

We are persuaded. While it is true that a transaction entered into by a party who is incapable of consent is viodable, however such transaction is valid until annulled. The redemption made by the four petitioners has never been annulled, thus, it is valid. (Ibid)

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

91. On the first assigned error, this Court has consistently held that the doctrine of exhaustion of administrative remedies is a relative one and is flexible depending on the peculiarity and uniqueness of the factual and circumstantial settings of a case. Among others, it is disregarded where, as in this case, (a) there are circumstances indicating the urgency of judicial intervention; and (b) the administrative action is patently illegal and amounts to lack or excess of jurisdiction. (DAR vs. APEX Investment and Financing Corporation; G.R. No. 149422, April 10, 2003).

92. In Natalia Realty vs. Department of Agrarian Reform, we held that the aggrieved landowners were not supposed to wait until the DAR acted on their letter-protests (after it had sat on them for almost a year) before resorting to judicial process. Given the official indifference which, under the circumstances could have continued forever, the landowners has to act to assert and protect their interests. Thus, their petition for certiorari was allowed even though the DAR had not yet resolved their protests. In the same vein, respondent here could not be expected to wait for petitioner DAR to resolve its protest before seeking judicial intervention. Obviously, petitioner might continue to alienate respondent’s lots during the pendency of its protest. Hence, the Court of Appeals did not err in concluding that on the basis of the circumstances of this case, respondent need not exhaust all administrative remedies before filing its petition for certiorari and prohibition. (Ibid)

93. In Roxas & Co., Inc. vs. Court of Appeals, we held:

“For a valid implementation of the CAR program, two notices are required: (1) the Notice of Coverage and letter of invitation to preliminary conference sent to the landowner, the representative of the BARC, LBP, farmer beneficiaries and other interested parties pursuant to DAR A.O. No. 12, series of 1989; and (2) the Notice of Acquisition sent to the landowner under Section 16 of R.A. No. 6657.

“The importance of the first notice, i.e., the Notice of Coverage and the letter of invitation to the conference, and its actual conduct cannot be understated. They are steps designed to comply with the requirements of administrative due process. The implementation of the CARL is an exercise of the State’s police power and the power of eminent domain. To the extent that the CARL prescribes retention limits to the landowners, there is an exercise of police power for the regulation of private property in accordance with the Constitution (Association of Small Landowners in the Philippines vs. Secretary of Agrarian Reform, 175 SCRA 343, 373-374 [1989]. But where to carry out such regulations, the owners are deprived of land they own in excess of the maximum area allowed there is also a taking under the power of eminent domain. The taking contemplated is not a mere limitation of the use of the land. What is required is the surrender of the title to and physical possession of the said excess and all beneficial rights accruing to the owner in favor of the farm beneficiary (id.). The Bill of Rights provides that “[n]o person shall be deprived of life, liberty or property without de process of law” (Section 1, Article III of the 1987 Constitution). The CARL was not intended to take away property without due process of law (Development Bank of the Philippines vs. Court of Appeals, 262 SCRA 245, 253 [1996]). The exercise of the power of eminent domain requires that due process be observe in taking of private property.” (Ibid)

94. In the instant case, petitioner does not dispute that respondent did not receive the Notice of Acquisition and Notice of Coverage sent to the latter’s old address. Petitioner explained that its personnel could not effect personal service of those notices upon respondent because it changed its juridical name from Apex Investment and Financing Corporation to SM Investment Corporation. While it is true, that personal service could not be made, however, there is no showing that petitioner caused the service of the notices via registered mail as required by Section 16(a) of R.A. 6657, On this point, petitioner claimed that the notices were sent “not only by registered mail but also by personal delivery” and that there was actual receipt by respondent as shown by the signature appearing at the bottom left-hand corner of petitioner’s copies of the notices. But petitioner could not identify the name of respondent’s representative who allegedly received the notices. In fact, petitioner admitted that the signature thereon is illegible, It is thus safe to conclude that respondent was not notified of the compulsory acquisition proceedings, Clearly, respondent was deprived of its right to procedural due process. It is elementary that before a person can be deprived of his property, he should be informed of the claim against him and the theory on which such claim is premised. (Ibid)

95. Section 4 of R.A. No. 6657 provides that the Comprehensive Agrarian Reform Law shall cover, regardless of tenurial arrangement and commodity produced, “all public and private agricultural lands.” Section 3© defines “agricultural land,” as “land devoted to agricultural activity as defined in this Act and not classified as mineral, forest, residential, commercial or industrial land.” (Ibid)

96. In dismissing outright the petition for certiorari, the CA reasoned that since it (petitioner LBP) was assailing the writ of execution issued by respondent Provincial Adjudicator, then its recourse was to file a petition for review under Rule 43 of the Revised Rules of Court. Section 1 thereof provides:

Sec. 1 Scope. – This Rule shall apply to appeals from judgments or final orders of the Court of Tax Appeals and from awards, judgments, final orders or resolutions of or authorized by any quasi-judicial agency in the exercise of its quasi-judicial functions. Among there agencies are the . . . . Department of Agrarian Reform under Republic Act No. 6657. . .

Contrary to the ratiocination of the appellate court, however, Rule 43 does not apply to an action to nullify a writ of execution because the same is not a “final order” within the contemplation of the said rule. As this Court fairly recently explained, “a writ of execution is not a final order or resolution, but is issued to carry out the mandate of the court in the enforcement of a final order or a judgment. It is a judicial process to enforce a final order or judgment against the losing party.” As such an order or execution is generally not appealable. (LBP vs. Hon. Pepito Planta and Faustino Tabla, G.R. No. 152324 April 29, 2005.

97. On the other hand certiorari lies where there is no appeal nor plain, speedy and adequate remedy in the ordinary course of law. Section 11, Rule XIII of the 1994 DARAB Rules of Procedure, which was then applicable, expressly provided, in part, that “the decision of the Adjudicator on land valuation and preliminary determination and payment of just compensation shall not be appealable to the Board but shall be brought directly to the RTCs designated as Special Agrarian Courts within fifteen (15) days from receipt of the notice hereof.” In relation to this provision, Section 16(f) of R.A. No. 6657 prescribed that any party who does not agree with the decision (in the summary administrative proceedings) may bring the matter to the court for final determination of just compensation. (Ibid)

98. Petitioner LBP urges the Court to reconcile the seeming inconsistency between the period to file certiorari under Section 54 of R.A. No. 6657 (within fifteen days from receipt of copy of the decision, order, award or ruling) and that under Section 4 of Rule 65 of the Revised Rules of Court (sixty days from notice of judgment, order or resolution). The Courts holds that Section 54 of RA No. 6657 prevails since it is a substantive law specially designed for agrarian disputes or cases pertaining to the application, implementation enforcement of interpretation of agrarian reform laws. However, the fifteen-day period provided therein is extendible, but such extension shall not extend the sixty-day period under Section 4, Rule 65 of the Revised Rules of Court.

99. Petitioner alleges that the Court of Appeals committed grave abuse of discretion in denying his motion for extension on the grounds that the petition “which petitioner intended to file is not the proper remedy”. . .

Petitioner’s contention is well-taken. The Court of Appeals was rather hasty in concluding that the petitioner was going to file a petition for certiorari solely on the basis of petitioner’s allegation that he was going to file a petition for certiorari. It should have reserved judgment on the mater until it had actually received the petition especially considering that petitioner’s motion for extension was filed well within the reglementary period for filing a petition for review. (Ibid) Supreme Court citing De Dios vs. CA, 274 SCRA 520)

100. Cases should be determined on the merits after all parties have been given full opportunity to ventilate their causes and defenses, rather than on technicalities or procedural imperfections. Rules of procedure are mere tools designed to expedite the decision or resolution of cases and other matters pending in court. A strict and rigid application of rules, resulting in technicalities that tend to frustrate rather than promote substantial justice, must be avoided. In fact, Rule 1, Section 6 of the Rules of Court states that the Rules shall be liberally construed in order to promote their objective of ensuring the just, speedy and inexpensive disposition of every action and proceeding. (Paulina Diaz, et al., vs. Carlos Mesias, Jr., G.R. No. 156345, March 19, 2004)

101. The mere issuance of an emancipation patent does not put the ownership of the agrarian reform beneficiary beyond attack and scrutiny. Emancipation patents may be cancelled for violations of agrarian laws, rules and regulations, Section 12(g) of P.D. 946 (issued on June 17, 1976) vested the then Court of Agrarian Relations with jurisdiction over cases involving the cancellation of emancipation patents issued under P.D. 266. Exclusive jurisdiction over such cases was later lodged with the DARAB under Section 1 of Rule II of the DARAB Rules of Procedure.

Aside from ordering the cancellation of emancipation patents, the DARAB may order reimbursement of lease rental as amortization to agrarian reform beneficiaries, forfeiture of amortization, ejectment of beneficiaries, reallocation of the land to qualified beneficiaries, perpetual disqualification to become agrarian reform beneficiaries, reimbursement of amortization payment and value of improvement, and other ancillary matters related to the cancellation of emancipation patents. (Liberty Ayo-Alburo vs. Uldarico Matobato, G.R. No. 155181, April 15, 2005).

102. Only questions of law, however, can be raised in a petition for review on certiorari under Rule 45 of the Rules of Court. Findings of fact by the CA are final and conclusive and cannot be reviewed on appeal to the Supreme Court, more so if the factual findings of the appellate court coincide with those of the DARAB, an administrative body with expertise on matters within its specific and specialized jurisdiction. This Court is not thus duty-bound to analyze and weigh all over again the evidence already considered in the proceedings below, subject to certain exceptions. (Ibid)

103. Petitioner furthermore argues that the amortization payments she made to the Land Bank in the amount of P9,825.80 should not have been forfeited in favor of respondent. On this score, the Court finds for petitioner. While the DARAB has jurisdiction to Order forfeiture of amortizations paid by an agrarian reform beneficiary, forfeiture should be made in favor of the government and not to the reallocatee of the landholding. (Ibid)

104. In Monsanto v. Zerna, (G.R. No. 142501, 7 December 2001) it was held that for DARAB to have jurisdiction over a case, there must exist a tenancy relationship between the parties. In order for a tenancy agreement to take hold over a dispute, it would be essential to establish all its indispensable elements to it: (1) the parties are the landowner and the tenant or agricultural lessee; (2) subject matter of the relationship is an agricultural land; (3) there is consent between the parties to the relationship; (4) that the purpose of the relationship is to bring about agricultural production (5) there is personal cultivation on the part of the tenant or agricultural lessee; and (6) the harvest is shared between the landowner and the tenant or agricultural lessee.

In the case a bar, the element that the parties must be “the landowner and the tenant or agricultural lessee” on which all other requisites of the tenancy agreement depends, is absent. Tenancy relationship is inconsistent with the assertion of ownership of both parties. Petitioners claim to be the owners of the entire Lot No. 5198, by virtue of a Certificate of Sale of Delinquent Real Property, while private respondents assert ownership over Lots Nos. 5198-A, 5198-A, 5198-B and 5198-D on the basis of an Emancipation Patent and Transfer Certificate of Title. Neither do the records show any juridical tie or tenurial relationship between the parties’ predecessors-in-interest. The questioned lot it allegedly declared for taxation purposes in the name of petitioners’ father, Dalmacio Arzaga who does not appear to have any connection with the private respondents nor with their alleged predecessor-in-interest, Caridad Fuentebella. (Rodolfo Arzaga, et al., vs. Salvacion Copias, et al., G.R. No. 152404, March 28, 2003).

105. In Chico v. Court of Appeals, (348 Phil. 37 1998) also an action for recovery of possession, the Court was confronted with the same jurisdictional issue. The petitioner therein claimed ownership over the disputed property pursuant to a final judgment, while the respondents asserted right to possession by virtue of an alleged tenancy relationship with one who has no juridical connection with the petitioners. In holding that it is the trial court and not the DARAB which has jurisdiction over the case, the Court ruled that the absence of a juridical tie between the parties or their predecessor-in-interest negates the existence of the element of tenancy relationship.

106. The basic rules is that jurisdiction over the subject matter is determined by the allegations in the complaint. Jurisdiction is not affected by the pleas or the theories set up by the defendant in an answer or a motion to dismiss. Otherwise, jurisdiction would become dependent almost entirely upon the whims of the defendant. From the averments of the complaint in the instant case, it is that the petitioners’ action does not involve an agrarian dispute, but one for recovery of possession, which is perfectly within the jurisdiction of the Regional Trail Courts. (Ibid)

107. Section 3© thereof defines “agricultural land,” as “land devoted to agricultural activity as defined in this Act and not classified as mineral, forest, residential, commercial or industrial land.” The terms “agriculture” or “agricultural activity” is also defined by the same law as follows:

Agriculture, Agricultural Enterprises or Agricultural Activity means 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 persons whether natural or juridical. (DAR vs. DECS, G.R. No. 158223, April 27, 2004)

108. Section 10 of R.A. No. 6657 enumerates the types of lands which are exempted from the coverage of CARP as well as the purposes of their exemption, viz:

x x x x x x x x x

c) Lands actually, directly and exclusively used and found to be necessary for national defense, school sites and campuses, including experimental farm stations operated by public or private schools for educations purposes, shall be exempt from the coverage of this Act.

x x x x x x x x x

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

The importance of the phrase “actually, directly, and exclusively used and found to be necessary” cannot be understated, as what respondent DECS would want us to do by not taking the words in their literal and technical definitions. The words of the law are clear and unambiguous. Thus, the “Plain meaning rules” or verba legis in statutory construction is applicable in this case. Where the words of a statute are clear, plain and free from ambiguity, it must be given its literal meaning and applied without attempted interpretation. (Ibid) (Note: To be exempt from the coverage, it is the land per se, not the income derived therefrom, that must be actually and exclusively used for educational purposes.)

109. In the case at bar, the BARC certified that herein farmers were potential CARP beneficiaries of the subject properties. Further, on November 23, 1994, the Secretary of Agrarian Reform through the Municipal Agrarian Reform Office (MARO) issued a Notice of Coverage placing the subject properties under CARP. Since the identification and selection of CARP beneficiaries are matters involving strictly the administrative implementation of the CARP, it behooves the court to exercise great caution in substituting its own determination of the issue, unless there is grave abuse of discretion committed by the administrative agency. In this case, there was none.

The Comprehensive Agrarian Reform Program (CARP) is the bastion of social justice of poor landless farmers, the mechanism designed to redistribute to the underprivileged the natural right to toil the earth, and to liberate them from oppressive tenancy. To those who seek its benefit, it is the means towards a viable livelihood and ultimately, a decent life. The objective of the State is no less certain: “landless farmers and farmworkers will receive the highest consideration to promote social justice and to move the nation toward sound rural development and industrialization. (Ibid)

110. The settled rule in this jurisdiction is that a party cannot change his theory of the case or his cause of action on appeal. We have previously held that “courts of justice have no jurisdiction or power to decide a question not in issue.” A judgment that goes outside the issues and purports to adjudicate something on which the court did not hear the parties, is not only irregular but also extra-judicial and invalid The rule rests on the fundamental tenets of fair play. In the present case, the Court must stick to the issue litigated in the DARAB and in the Court of Appeals, which is whether petitioner has the right to eject the Spouses Velasco from the land under RA 3844. (Henry Mon vs. CA, Hon. Leopoldo Serrano, Jr., et al., G.R. No. 118292, April 2, 2004).

111. Administrative Law: The power of subordinate legislation allows administrative bodies to implements the broad policies laid down in a statute by “filing in” the details, and all that us required it that the regulation should be germane to the objects and purposes of law and that the regulations be not in contradiction to but in conformity with the standards prescribed by the law. The power of subordinate legislation allows administrative bodies to implement the board policies laid down in a statute by “filing in” the details. All that is required is that the regulations be not in contradiction to but in conformity with the standards prescribed by the law. One such administrative regulations is DAR Memorandum Circular NO, 6. As emphasized in De Chavez v. Zobel emancipation is the goal of P.D. 27, i.e., freedom from the bondage of the soil by transferring to the tenant-farmers the ownership of the land they’re tilling. (Rolando Sigre vs. CA and Lilia Gonzales, 387 SCRA 15).

112. Since DAR Memorandum Circular No. 6 essentially sought to accomplish the noble purpose of P.D. 27, it is therefore valid and has the force of law. The rationale for the Circular was, in fact, explicitly recognized by the appellate court when it stated that “The main purpose of the circular is to make certain that the lease rental payments of the tenant-farmer are applied to his amortizations on the purchase price of the land. x x x The circular is meant to remedy the situation where the tenant-farmer’s lease rentals to landowner were not credited in his favor against the determined purchase price of the land, thus making him a perpetual obligor for said purchase price.” Since the assailed circular essentially sought to accomplish the noble purpose of P.D. 27, it is therefore valid. Such being the case, it has the force of law and is entitled to great respect. (Ibid)

113. The Court cannot see any “irreconcilable conflict” between P.D. No. 816 and DAR Memorandum Circular No. 6. Enacted in 1975, P.D. No. 816 provides that the tenant-farmer (agricultural lessee) shall pay lease rentals to the landowner until the value of the property has been determined or agreed upon by the landowner and the DAR. On the other hand, DAR Memorandum Circular No. 6, implemented in 1978, mandates that the tenant-farmer shall pay to LBP the lease rental after the value of the land has been determine. (Ibid)

114. Both Memorandum Circular No. 6 and P.D. 816 were issued pursuant to and in implementation of P.D. 27 – these must not be read in isolation, but rather, in conjunction with each other. (Private respondent, however “splits hairs,” so to speak, and contends that the Curso case is premised on the assumption that the Circular implement P.D. 816, whereas it is expressed stated in the Circular that it was issued in implementation of P.D. 27. These must not be read in isolation, but rather, in conjunction with each other. Under P.D. 816, rental payments shall be made to the landowner. After the value of the land has been determined/established, then the tenant-farmers shall pay their amortizations to the LBP, as provided in DAR Circular No. 6. Clearly there is no inconsistency between them. Au contraire, P.D. 816 and DAR Circular No. 6 supplement each other insofar as it sets the guidelines for the payments of lease rentals on the agricultural property. (Ibid)

115. That P.D. 27 does not suffer any constitutional infirmity is a judicial fact that has been repeatedly emphasized by the Supreme Court. – Further, that P.D. 27 does not suffer any constitutional infirmity is a judicial fact that has been repeatedly emphasized by this Court in a number of cases. As early as 1974, in the aforecited case of De Chavez v. Zobel, P.D. 27 was assumed to be constitutional, and upheld as part and parcel of the land of the land, viz: “There is no doubt then, as set forth expressly therein, that the goal is emancipation. What is more, the decree is now part and parcel of the law of the land according to the revised Constitution itself. Ejectment therefore of petitioners is simply out of the question. That would be to set at naught an express mandate of the Constitution. Once it has spoken, our duty is clear; obedience is unavoidable. This is not only so because of the cardinal postulate of constitutionalism, the supremacy of the fundamental law. It is also because any other approach would run the risk of setting at naught this basic aspiration to do away with all remnants of a feudalistic order at war with the promise and the hope associated with an open society. To deprive petitioners of the small landholdings in the face of a presidential decree considered ratified by the new Constitution and precisely in accordance with its avowed objective could indeed be contributory to perpetuating the misery that tenancy had spawned in the past as well as the grave social problems thereby created. There can be no justification for any other decision then whether predicated on a juridical norm or on the traditional role assigned to the judiciary of implementing and not thwarting fundamental policy goals.” (Ibid)

116. Eminent Domain; Just compensation; the determination of just compensation under P.D. No. 27, like in section 16(d) of R.A. 6657 or the CARP Law, is not final or conclusive – unless both the landowner and the tenant-farmer accept the valuation of the property by the Barrio Committee on Land Production and the DAR, the parties may bring the dispute to court in order to determine the appropriate amount of compensation, a task unmistakably within the prerogative of the court. The determination of just compensation under P.D. No. 27, like in section 16 (d) of R.A. 6657 or the CARP Law is not final or conclusive. This is evident from the succeeding paragraph of Section 2 of E.O. 228: “x x x In the event of dispute with the landowner regarding the amount of lease rental paid by the farmer beneficiary, the Department of Agrarian Reform and the Barangay Committee on Land Production concerned shall resolve the dispute within thirty (30) days from its submission pursuant to Department of Agrarian Reform Memorandum Circular No. 26, series of 1973, and other pertinent issuances, In the event a party questions in court the resolution of the dispute the landowner’s compensation shall still be processed for payment and the proceeds shall be held in trust by the Trust Department of the Land Bank in accordance with the provisions of Section 5 hereof, pending the resolution of the dispute before the court.” Clearly therefrom, unless both the landowner and the tenant-farmer accept the valuation of the property by the Barrio Committee on Land production and the DAR the parties may bring the dispute to court in order to determine the appropriate amount of compensation, a task unmistakably within the prerogative of the court. (LBP vs. CA and Lilia Gonzales, 387 SCRA 15).

117. Republic Act No. 6657; The Court need not belabor the fact that R.A. 6657 or the CARP Law operates distinctly from P.D. 27 R.A. 6657 covers all public and private agricultural and including other lands of the public domain suitable for agriculture as provided for in Proclamation No. 131 and Executive Order No. 229; while, P.D. 27 covers rice and corn lands. On this score, E.O. 229, which provides for the mechanism of the Comprehensive Agrarian Reform Program, specifically states: “(P)residential Decree No. 27, as amended, shall continue to operate with respect to rice and corn lands, covered thereunder. x x x” It cannot be gainsaid, therefore, that R.A. 6657 did not repeal or supersede, in any way, P.D.27.And whatever provisions of P.D. 27 that are not inconsistent with R.A 6657 shall be suppletory to the latter, and all rights acquired by the tenant-farmer under P.D. 27 are retained even with the passage of R.A 6657.

118. We have repeatedly stressed that social justice – or any justice for that matter – is for the deserving, whether he be a millionaire in his mansion or a pauper in his hovel. It is true that, in case of reasonable doubt, we are to tilt the balance in favor of the poor to whom the Constitution fittingly extends its sympathy and compassion. But never is it justified to give preference to the poor simply because they are poor, or reject the rich simply because they are rich, for justice must always be served for the poor and the rich alike according to the mandate of the law. (Gelos vs. CA, 208 SCRA 608, 616) (cited in Victor G. Valencia vs. CA, G.R. No. 122363; April 29, 2003)

119. From the foregoing discussion, it is reasonable to conclude that a civil law lessee cannot automatically institute tenants on the property under to Sec. 6 of R.A. No. 3844. The correct view that must necessarily be adopted is that the civil law lessee, although a legal possessor, may not install tenants on the property unless expressly authorized by the lessor. And if a prohibition exists or is stipulated in the contract of lease the occupants of the property are merely civil law subleases whose rights terminate upon the expiration of the civil law lease agreement. (Victor Valencia vs. CA G.R. No. 122363, April 29, 2003).

120. Agrarian Reform ; Presidential Decree No. 27; Homesteads; Parcels of land, though obtained by homestead patents under Commonwealth Act 141, are covered by land reform under Presidential Decree 27. – Petitioner’s contention is without legal basis. Presidential Decree (PD) No. 27, under which the Emancipation Patents sought to be cancelled here were issued to respondents, “applies to all tenanted private agricultural lands primarily devoted to rice and corn under a system of share-crop or lease-tenancy, whether classified as landed estate or not.” The law makes no exceptions whatsoever in its coverage. Nowhere therein does it appear that lots obtained by homestead patents are exempt from its operation. The matter is made even clearer by Department Memorandum No. 2, Series of 1978, which states: “Tenanted private agricultural lands primarily devoted to rice and/or corn which have been acquired under the provisions of Commonwealth Act 141, as amended, shall also be covered by Operation Land Transfer.” Unquestionably, petitioner’s parcels of land, though obtained by homestead patents under Commonwealth Act 141, are covered by land reform under PD 27. (Florencia Paris vs. Dionisio A. Alfeche, et al., 364 SCRA 110).

121. The right to retain an area of seven hectares is not absolute – it is premised on the condition that the landowner is cultivating the area sought to be retained or will actually cultivate it upon effectivity of the law. – Clearly, the right to retain an area of seven hectares is not absolute. It is premised on the condition that the landowner is cultivating the area sought to be retained or will actually cultivate it upon effectivity of the law. In the case at bar, neither of the conditions for retention is present. As admitted by petitioner herself, the subject parcels are fully tenanted; thus, she is clearly not cultivating them, nor will she personally retain any portion of her landholdings. (Ibid)

122. Homestead grantees or their direct compulsory heirs can own and retain the original homesteads, only for as long as they continue to cultivate them. – Indisputably, homestead grantees or their direct compulsory heirs can own and retain the original homesteads only for “as long as they continue to cultivate” them. That parcels of land are covered by homestead patents will not automatically exempt them from the operation of land reform. It is the fact of continued cultivation by the original grantees or their direct compulsory heirs that shall exempt their lands from land reform coverage. (Ibid)

123. Although, under the law, tenant farmers are already deemed owners of the land they till, they are still required to pay the cost of the land, including interest, within fifteen years before the title is transferred to them. Thus, the court held in Association of Small Landowners in the Philippines v. Secretary of Agrarian Reform: “It is true that PD 27 expressly ordered the emancipation of tenant-farmers as of October 21, 1972 and declared that he shall be deemed the owner of a portion of land consisting of a family-sized farm except that no title to the land owned by him was to be actually issued to him unless and until he had become a full-fledged member of a duly recognized farmers’ cooperative. It was understood, however, that full payment of the just compensation also had to be made first, conformably to the constitutional requirement.” (Ibid)

124. Executive Order 228; Evidently, the law recognizes that the land’s exact value, or the just compensation to be given the landowner cannot just be assumed – it must be determined with certainly before the land titles are transferred’ although Executive Order 228, provides that the total lease rentals paid for the lands from October 21, 1972 shall be considered as advance payment, it does not sanction the assumption that such rentals are automatically considered as equivalent to just compensation for the land. – Presidential Decree 27 and subsequently Executive Order (EO) 228, which recognized the rights acquired by tenant-farmers under PD 27, provides in detail the computation to be used in arriving at the exact total cost of the parcels of land. Evidently, therefore, the law recognizes that their exact value, or the just compensation to be given to the landowner, cannot just be assumed; it must be determined with certainly before the land titled are transferred. Although EO 228 provides that the total lease rentals paid for the lands from October 21, 1972 shall be considered as advance payment, it does not sanction the assumption that such rentals are automatically considered as equivalent to just compensation for the land. The provision significantly designates the lease rentals as advance not full payment. The determination of the exact value of the lands cannot simply be brushed aside, as it is fundament to the determination of whether full payment has been made. (Ibid)

125. Respondent correctly cited the case of Gabatin v. Land Bank of the Philippines, where the Court held that “in computing the just compensation for expropriation proceedings, it is the value of the land at the time of the taking [or October 21, 1972], the effectivity date of P.D. No. 27], not at the time of the rendition of judgment, which should be taken into consideration.” Under P.D. No. 27 and E.O. No. 228, the following formula is used to compute the land value for palay:

LV (land value = 2.5 x AGP x GSP x (1.06)n

It should also be pointed out, however, that in the more recent case of Land Bank of the Philippines vs. Natividad, The Court categorically ruled: “ the seizure of the landholding did not take place on the date of effectivity of P.D. No. 27 but would take effect on the payment of just compensation.” Under Section 17 of R.A. No. 6657, the following factors are considered in determining just compensation, to wit:

Sec, 17. Determination of Just Compensation. – In determining just compensation, the cost of acquisition of the land, the current value of like properties, its nature, actual use and income, the sworn valuation by the owner, the tax declarations, and the assessment made by government assessors shall be considered. The social and economic benefits contributed by the farmers and the farm-workers and by the Government to the property as well as the non-payment of taxes or loans secured from any government financing institution on the said land shall be considered as additional factors to determine its valuation. (Emphasis supplied).

Consequently, the question that arises is which of these two rulings should be applied?

Under the circumstances of this case, the Court deems it more equitable to apply the ruling in the Natividad case. In said case, The Court applied the provision of R.A. No. 6657 in computing just compensation for property expropriated under P.D. No. 278, stating, viz.:

Land Bank’s contention that the property was acquired for purposes of agrarian reform on October 21, 1972, the time of the effectivity of PD 27, ergo just compensation should based on the value of the property as of that time and not at the time of possession in 1993, is likewise erroneous. In Office of the President, Malacañang, Manila v. Court of Appeals, we ruled that the seizure of the landholding did not take place on the date of effectivity of PD 27 but would take effect on the payment of just compensation.

Under the factual circumstances of this case, the agrarian reform process is still incomplete as the just compensation to be paid private respondents has yet to be settled. Considering the passage of Republic Act No. 6657 before the completion of this process, the just compensation should be determined and the process concluded under the said law. Indeed, RA 6657 is the applicable law, with PD 27 and EO 228 having only suppletory effect, conformably with our ruling in Paris v. Alfeche.

x x x x

It would certainly be inequitable to determine just compensation based on the guideline proved by PD 27 and EO 228 considering the DAR’s failure to determine the just compensation for a considerable length of time. That just compensation should be determined in accordance with RA 6657, and not PD 27 or EO 228, is especially imperative considering that just compensation should be the full and fair equivalent of the property taken from its owner by the expropriator, the equivalent being real, substantial, full and ample.

In this case, the trial court arrived at the just compensation due private respondents for their property, taking into account its nature as irrigated land, location along the highway, market value, assessor’s value and the volume and value of its produce. This Court is convinced that the trial court correctly determined the amount of just compensation due private respondents in accordance with, and guided, by RA 6657 and existing jurisprudence. (Emphasis supplied).

As previously noted, the property was expropriated under the Operation Land Transfer scheme of P.D. No. 27 way back in 1972. More than 30 years have passed and petitioners are yet to benefit from it, while the farmer-beneficiaries have already been harvesting its produce for the longest time. Events have rendered the applicability of P.D. No. 27 inequitable. Thus, the provisions of R.A. No. 6657 should apply in this case. (Anacleto R. Menesis, et. al., vs. Sec. of Agrarian Reform, et. al., G.R. No. 156304; October 23, 2006)

The Court agrees with the petitioner’s contention that, under Section 2(f), Rule II of the DARAB Rules of Procedures, the DARAB has jurisdiction over cases involving the issuance, correction and cancellation of CLOAs which were registered with the LRA. However, for the DARAB to have jurisdiction in such case, they must relate to an agrarian dispute between landowner and tenants to whom CLOAs have been issued by the DAR Secretary. The cases involving the issuance, correction and cancellation of the CLOAs by the DAR in the administrative implementation of agrarian laws, rules and regulations to parties who are not agricultural tenants or lessees are within the jurisdiction of the DAR and not of the DARAB. (Heirs of Julian dela Cruz, et. al., vs. Heirs of Alberto Cruz, represented by Benedicto V. Cruz., G.R. 162890; November 22, 2005)

Section 3(d) of R.A. No. 6657 defines an “agrarian dispute” as “any controversy relating to tenurial arrangements, whether leasehold, tenancy stewardship or otherwise, over lands devoted to agricultural, 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 condition of transfer of ownership from landowners to farmworkers, tenants and other agrarian reform beneficiaries, whether the disputants stand in the proximate relation of farm operation and beneficiaries, landowner and tenant, or lessor and lessee.”

In Morta, Sr. v. Occidental (G.R. 123417, 10 June 1999, 308 SCRA 167), this Court held that there must be a tenancy relationship between the parties for the DARAB to have jurisdiction over a case. It is essential to establish all its indispensable elements, to wit: (1) that the parties are the landowner and the tenant or agricultural lessee; (2) that the subject matter of the relationship is an agricultural land; (3) that there is consent between the parties to the relationship (4) that the purposes of the relationship is to bring about agricultural production; (5) that there is personal cultivation on the part of the tenant or agricultural lessee; and (6) that the harvest is shared between the landowner and the tenant or agricultural lessee. (ibid)

126. Certificates of Title issue pursuant to Emancipation Patents are as indefeasible as TCTs issued in registration proceedings. Ybañes v. Intermediate Appellate Court ( G.R. No. 68291, 6 March 1991, 194 SCRA 743,749-750) provides that certificates of title issued in administrative proceedings are as indefeasible as certificates of title issued in judicial proceedings:

It must be emphasized that a certificate of title issued under an administrative proceedings pursuant to a homestead patent, as in the instant case,, is as indefeasible as a certificate of title issued under a judicial registration proceeding, provided the land covered by the said certificate is a disposable public land within the contemplation of the Public Law.

There is no specific provision in the Public Land law (C.A. No. 141, as amended) or the Land Registration Act (Act 496), now P.D. 1529, fixing the one (1) year period within which the public land patent is open to review on the ground of actual fraud as in Section 38 of the Land Registration Act, now Section 32 of P.D. 1529, and clothing a pubic land patent certificate of title with indefeasibility. Nevertheless, the pertinent pronouncements in the aforecited cases clearly reveal that Section 38 of the Land Registration Act, now Section 32 of P.D. 1529 was applied by implication by this Court to the patent issued by the Director of Lands duly approved by the Secretary of Natural Resources, under the signature of the President of the Philippines in accordance with law. The date of issuance of the patent, therefore, corresponds to the date of the issuance of the decree in ordinary registration cases because the decree finally awards the land applied for registration to the party entitled to it, and the patent issued by the Director of Lands equally and finally grant, awards, and conveys the land applied for to the applicant. This, to our minds, is in consonance with the intent and spirit of the homestead laws, i.e. conservation of a family home, and to encourage the settlement, residence and cultivation and improvement of the lands of the public domain. If the title to the land grant in favor of the homesteader would be subject to inquiry, contents and decision after it has been given by the Government through the process of proceedings in accordance with the Public Land Law, there would arise uncertainty, confusion and suspicion on the government’s system of distributing public agricultural lands pursuant to the “Land for the Landless” policy of the State.

The same confusion, uncertainty and suspicion on the distribution of government-acquired lands to the landless would arise if the possession of the grantee of an EP would still be subject to contest, just because his certificate of title was issued in an administrative proceeding. The silence of Presidential Decree No. 27 as to the indefeasibility of titles issued pursuant thereto is the same as that in the Public Land Act where Prof. Antonio Noblejas commented:

Inasmuch as there is no positive statement of the Public Land Law, regarding the titles granted thereunder, such silence should be construed and interpreted in favor of the homesteader who come into the possession of his homestead after complying with the requirements thereof. Section 38 of the Land Registration Law should be interpreted to apply by implication to the patent issued by the Director of Land, duly approved by the Minister of Natural Resources, under the signature of the President, in accordance with law. (REGISTRATION OF LAND, TITLE AND DEEDS, Antonio H. Noblejas, p. 431 (1992 revised ed.).

After complying with the procedure, therefore, in Section 105 of Presidential Decree No. 1529, otherwise known as the Property Registration Decree (where the DAR is required to issue the corresponding certificate of title after granting an EP to tenant-farmers who have complied with Presidential Decree No. 27 (Presidential Decree No. 1529, Section 105), the TCT is issued to petitioners pursuant to their EPs acquire the same protection accorded to other TCTs. “The certificate of title becomes indefeasible and incontrovertible upon the expiration of one year from the date of the issuance of the order for the issuance of the patent, x x x. lands covered by such title may no longer be the subject matter of a cadastral proceeding, nor can it be decree to another person (Amando D. Aquino, LAND REGISTRATION AND RELATED PROCEEDINGS, Chapter XII “Land Patent”, p. 139; citing Gomez v. Court of Appeals, G.R. No. L-77770, 15 December 1988, 168 SCRA 503, 511; Dura v. Oliva, 113 Phil. 144.148-149 (1961) (Samuel Estribillo, et. al., vs. Department of Agrarian Reform and Hacienda Maria, Inc., et. al., G.R. 159674; June 30, 2006)

127. As we held through Justice J.B.L. Reyes in Lahora v. Dayanghirang, Jr. (147 Phil. 301,304 (1971). The rule in this jurisdiction, regarding public land patent and the character of the certificate of title that may be issued by virtue thereof, it that where land is granted by the government to a private individual, the corresponding patent thereof is recorded, and the certificate of title is issued to the grantee thereafter, the land is automatically brought within the operation of the Land Registration Act, the title issued to the grantee becoming entitled to all the safeguards provided in Section 38 of the said Act. In other words upon expiration of one year from its issuance, the certificate of title shall become irrevocable and indefeasible like a certificate issued in a registration proceeding (Emphasis supplied).

The EPs themselves, like the Certificates of Land Ownership Award (CLOAs) in Republic Act No. 6657 (the Comprehensive Agrarian Reform Law of 1988), are enrolled in the Torrens system of registration. The Property Registration Decree in fact devotes Chapter IX (Chapter IX: CERTIFICATE OF LAND TRANSFER, EMANCIPATION PATENT, AFFIDAVIT OF NON-TENANCY) on the subject of EPs. Indeed, such EPs and CLOAs are, in themselves, entitled to be as indefeasible as certificate of title issued in registration proceedings. (Ibid)

128. More importantly, petitioner is not a real party-in-interest in this case. According to Sec. 2 of Rule 3 of the Rules of Court, a real party-in-interest is the party who stands to be benefited or injured by the judgments in the suit or the party entitled to the avails of the suit. We stand by the ruling in Fortich v. Corona that farmer-beneficiaries, who are not approved awardees of CARP, are not real parties-in-interest. In Fortich, the farmers who intervened in the case were mere recommendees. We stated in said case that:

The rule in this jurisdiction is that a real party in interest is 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. Undoubtedly, movants’ interest over the land in question is a mere expectancy Ergo, they are not real parties in interest.

In the case at bar, members of petitioners Samahan are mere qualified beneficiaries of CARP. The certification that CLOAs were already generated in their names, but were not issued because of the present dispute, does not vest any right to the farmers since the fact remains that they have not yet been approved as awardees, actually awarded lands, or granted CLOAs. Respondents cannot be considered estoppted from questioning petitioner’s legal standing since petitioner appeared before the OP after the latter decided in respondents’ favor. When the petitioner appealed the case to the CA, respondents duly questioned the petitioner’s capacity to sue. (Samahang Magsasaka ng 53 Hectarya, represented by Elvira M. Balaclad, et. al., vs. Wilfredo G. Mosquera, et. al., G.R. 152430; March 22, 2007)

129. In the case at bar, we find that the impugned A.O. is invalid as it contravenes the Constitution. The A.O. sought to regulate livestock farms by including them in the coverage of agrarian reform and prescribing a maximum retention limit for their ownership. However, the deliberations of the 1987 Constitutional Commission show a clear intent to exclude, inter alia, all land exclusively devoted to livestock, swine and poultry-raising. The Court clarified in the Luz Farms case that livestock, swine and poultry-raising are industrial activities and do not fall within the definition of “agriculture” or “agricultural activity”. The raising of livestock, swine and poultry is different from crop or tree farming. It is an industrial, not an agricultural, activity. A great portion of the investment in this enterprise is in the form of industrial fixed assets, such as: animal housing structures and facilities, drainage, waters and blowers, feed mill with grinders, mixers, conveyor, exhausts and generators, extensive warehousing facilities for feeds and other supplies, anti-pollution equipment like bio-gas and digester plants augmented by lagoons and concrete ponds. Deepwells, elevated water tanks, pumphouses, sprayers, and other technological appurtenances.

Clearly, petitioner DAR has no power to regulate livestock farms which have been exempted by the Constitution from the coverage of agrarian reform. It has exceeded it power in issuing the assailed A.O. (DAR et. al., vs. Delia T. Sutton et al., G.R. 162070, October 19, 2005)

132. The subsequent case of Natalia Realy, Inc. v. DAR reiterated our ruling in the Luz Farms case. In Natalia Realty, the Court held that industrial, commercials and residential lands are not covered by the CARL. We stressed anew that while Section 4 of R.A. No. 6657 provides that the CARL shall cover all public and private agricultural lands, the term “agricultural land” does not include lands classified as mineral, forest, residential, commercial or industrial. Thus, in Natalia Realty, even portions of the Antipolo Hill Subdivision, which are arable yet still undeveloped, could not be considered as agricultural lands subject to agrarian reform as these lots were already classified as residential lands.

Moreover, it is a fundamental rule of statutory construction that the reenactment of a statute by Congress without substantial change is an implied legislative approval and adoption of the previous law. On the other land, by making a new law, Congress seeks to supersede an earlier one. In the case at bar, after the passage of the 1988 CARL, Congress enacted R.A, No. 7881 which amended certain provision of the CAR. Specifically, the new law change the definition of the terms “agricultural activity” and commercial farming” by dropping from its coverage lands that are devoted to commercial livestock, poultry and swine-raising. With this significant modification, Congress clearly sought to align the provision of our agrarian laws with the intent of the 1987 Constitutional Commission to exclude livestock farms from the coverage of agrarian reform. (Ibid)

133. As general rule, before a party may be allowed to invoke the jurisdiction of the courts of justice, he is expected to have exhausted all means of administrative redress (Roxas & Co., Inc. v. Court of Appeals , 378 Phil. 727 (1999). In the instant case, it is beyond dispute that petitioner failed to resort to proper administrative recourse in resisting the Notice of Coverage issued by respondent MARO. Unsuccessful in its attempt to oppose the Notice of Coverage when it lodged its protest with the incorrect administrative offices, petitioner resorted to a judicial remedy. The petition for mandamus, which it filed, however, was correctly denied by the Court of Appeals. Truly, a petition for mandamus is premature if there are administrative remedies available to petitioner (Gualberto Castro v. Ricardo Gloria, 415 Phil. 645 (2001) (Nicanor T. Santos Dev’t. Corp. vs. Hon. Sec., DAR, et al., G.R. No. 159654; February 28, 2006)

134. Is it settled that mandamus is employed to compel the performance, when refused, of a ministerial duly, this being its main objective. It does not lie to require anyone to fulfill a discretionary duty. It is essential to the issuance of a writ of mandamus that petitioner should have a clear legal right to the thing demanded and it must be imperative duty of the respondent to perform the act required. It never issues in doubtful cases. While it may not be necessary that the duty be absolutely pressed, it must nevertheless be clear. The writ will not issue to compel an official to do anything which is not his duty to do or which is his duty not to do, or give to the applicant anything to which he is not entitled by law. The writ neither confers powers nor imposes duties. It is simply a command to exercise a power already possessed and to perform a duty already imposed. (Erlinda C. Pefianco v. Ma. Luisa C. Moral, 379 Phil. 468 (2000). (Ibid).

135. Petitioner’s filing of an answer has thereby cured whatever jurisdictional defect it now raises. As we have said time and again, “the active participation of a party in a case pending against him before a court or a quasi judicial body, is tantamount to a recognition of that court’s or body’s jurisdiction and a willingness to abide by the resolution of the case and will bar said party from later on impugning the court’s or body’s jurisdiction”. (Alcantara vs. Commission on the Settlement of Land [problems, 361 SCRA 664, 669 [2001]). (Lapanday Agricultural & Dev’t. Corp. vs. Maximo Estita, et al., G.R. NO. 162109, January 21, 2005).

136. Waivers of rights and/or interests over landholdings awarded by the government are invalid for being violative of the agrarian reform laws. To quote from our decision in Torres vs. Ventura, as reiterated in Corpus vs. Sps. Grospe. (333 SCRA 425, 436 [2000]

“x x x As such [the farmer-beneficiaries] gained the rights to possess, cultivate and enjoy the landholding for himself. Those rights over the particular property were granted by the government to him and no other. To ensure his continued possession and enjoyment of the property, he could not, under the law, make any valid form of transfer except to the government or by hereditary succession to his successors.” (Ibid)

137. The court finds that the December 22, 1994 Order of Execution issued by the DAR Regional Director suffers from jurisdiction and procedural defects as it directed the relocation of petitioners without first conducting a hearing or survey to determine the portion of the subject property excluded from the CARP.

A writ of execution should conform to the dispositive portion of the decision to be executed, and the execution is void if it is excess of and beyond the original judgment or award, for it is a settled general principle that a writ of execution must conform strictly with every essential particular of the judgment promulgated. (Ex-Bataan Security Agency, Inc. v. NLRC, 320 Phil. 517 (1995). It may not vary the terms of the judgment it seeks to enforce. Nor may it go beyond the terms of the judgment sought to be executed (Nazareno v. Court of Appeals, et al., 383 Phil. 229 (2000). Where the writ of execution is not in harmony with and exceeds the judgment which gives it life, the writ has pro tanto no validity (Buan v. Court of Appeals, 235 SCRA 424 (1994). (Ernesto Ingles, et al., vs. Court of Appeals, et al., G.R. No. 125202, January 31, 2006).

138. Petitioners’ contention that the authority to issue the Order of Execution is vested with the DARAB and not with the DAR Regional Director is likewise correct.

A Regional Director is the head of a DAR Regional Office which, under the Administrative Code of 1987, is responsible for “supporting the field units and supervising program implementation of the Department within the region.” The function of the DAR Regional Office includes “[implementing] laws, policies, plans, rules and regulations of the Department in the regional area.” A similar function is delegated to the DAR Regional Offices under Executive Order No. 129-A. Thus, the functions of the DAR Regional Director are purely administrative, that it , to put into operation agrarian laws and fill out the details necessary for their implementation, and not adjudicatory.

On the other hand, when a dispute arises between parties affected by the operation of agrarian laws, the controversy should be settled in a adversarial proceeding before the DARAB, the quasi-judicial arm of the DAR (Section 50, R.A. No. 6657; Quasi-Judicial Powers of the DAR. – the DAR is hereby vested with primary jurisdiction over all matters involving the implementation of agrarian reform, except those falling under the exclusive jurisdiction of the Department of Agricultural (DA) and the Department of Environment and Natural Resources (DENR). A function becomes judicial or quasi judicial in nature when the exercise thereof involves the determination of rights and obligations of the parties. (Ibid).