Republic of the PhilippinesSUPREME COURTManilaSECOND
DIVISIONG.R. No. 78517 February 27, 1989GABINO ALITA, JESUS JULIAN,
JR., JESUS JULIAN, SR., PEDRO RICALDE, VICENTE RICALDE and ROLANDO
SALAMAR,petitioners,vs.THE HONORABLE COURT OF APPEALS, ENRIQUE M.
REYES, PAZ M. REYES and FE M. REYES,respondents.Bureau of Agrarian
Legal Assistance for petitioners.Leonardo N. Zulueta for Enrique
Reyes, et al. Adolfo S. Azcuna for private
respondents.PARAS,J.:Before us is a petition seeking the reversal
of the decision rendered by the respondent Court of Appeals**on
March 3, 1987 affirming the judgment of the court a quo dated April
29, 1986, the dispositive portion of the trial courts decision
reading as follows;WHEREFORE, the decision rendered by this Court
on November 5, 1982 is hereby reconsidered and a new judgment is
hereby rendered:1. Declaring that Presidential Decree No. 27 is
inapplicable to lands obtained thru the homestead law,2. Declaring
that the four registered co-owners will cultivate and operate the
farmholding themselves as owners thereof; and3. Ejecting from the
land the so-called tenants, namely; Gabino Alita, Jesus Julian,
Sr., Jesus Julian, Jr., Pedro Ricalde, Vicente Ricalde and Rolando
Salamar, as the owners would want to cultivate the farmholding
themselves.No pronouncement as to costs.SO ORDERED. (p. 31,
Rollo)The facts are undisputed. The subject matter of the case
consists of two (2) parcels of land, acquired by private
respondents predecessors-in-interest through homestead patent under
the provisions of Commonwealth Act No. 141. Said lands are situated
at Guilinan, Tungawan, Zamboanga del Sur.Private respondents herein
are desirous of personally cultivating these lands, but petitioners
refuse to vacate, relying on the provisions of P.D. 27 and P.D. 316
and appurtenant regulations issued by the then Ministry of Agrarian
Reform (DAR for short), now Department of Agrarian Reform (MAR for
short).On June 18, 1981, private respondents (then plaintiffs),
instituted a complaint against Hon. Conrado Estrella as then
Minister of Agrarian Reform, P.D. Macarambon as Regional Director
of MAR Region IX, and herein petitioners (then defendants) for the
declaration of P.D. 27 and all other Decrees, Letters of
Instructions and General Orders issued in connection therewith as
inapplicable to homestead lands.Defendants filed their answer with
special and affirmative defenses of July 8, 1981.Subsequently, on
July 19, 1982, plaintiffs filed an urgent motion to enjoin the
defendants from declaring the lands in litigation under Operation
Land Transfer and from being issued land transfer certificates to
which the defendants filed their opposition dated August 4, 1982.On
November 5, 1982, the then Court of Agrarian Relations 16th
Regional District, Branch IV, Pagadian City (now Regional Trial
Court, 9th Judicial Region, Branch XVIII) rendered its decision
dismissing the said complaint and the motion to enjoin the
defendants was denied.On January 4, 1983, plaintiffs moved to
reconsider the Order of dismissal, to which defendants filed their
opposition on January 10, 1983.Thus, on April 29, 1986, the
Regional Trial Court issued the aforequoted decision prompting
defendants to move for a reconsideration but the same was denied in
its Order dated June 6, 1986.On appeal to the respondent Court of
Appeals, the same was sustained in its judgment rendered on March
3, 1987, thus:WHEREFORE, finding no reversible error thereof, the
decision appealed from is hereby AFFIRMED.SO ORDERED. (p. 34,
Rollo)Hence, the present petition for review on certiorari.The
pivotal issue is whether or not lands obtained through homestead
patent are covered by the Agrarian Reform under P.D. 27.The
question certainly calls for a negative answer.We agree with the
petitioners in saying that P.D. 27 decreeing the emancipation of
tenants from the bondage of the soil and transferring to them
ownership of the land they till is a sweeping social legislation, a
remedial measure promulgated pursuant to the social justice
precepts of the Constitution. However, such contention cannot be
invoked to defeat the very purpose of the enactment of the Public
Land Act or Commonwealth Act No. 141. Thus,The Homestead Act has
been enacted for the welfare and protection of the poor. The law
gives a needy citizen a piece of land where he may build a modest
house for himself and family and plant what is necessary for
subsistence and for the satisfaction of lifes other needs. The
right of the citizens to their homes and to the things necessary
for their subsistence is as vital as the right to life itself. They
have a right to live with a certain degree of comfort as become
human beings, and the State which looks after the welfare of the
peoples happiness is under a duty to safeguard the satisfaction of
this vital right. (Patricio v. Bayog, 112 SCRA 45)In this regard,
the Philippine Constitution likewise respects the superiority of
the homesteaders rights over the rights of the tenants guaranteed
by the Agrarian Reform statute. In point is Section 6 of Article
XIII of the 1987 Philippine Constitution which provides:Section 6.
The State shall apply the principles of agrarian reform or
stewardship, whenever applicable in accordance with law, in the
disposition or utilization of other natural resources, including
lands of public domain under lease or concession suitable to
agriculture, subject to prior rights, homestead rights of small
settlers, and the rights of indigenous communities to their
ancestral lands.Additionally, it is worthy of note that the newly
promulgated Comprehensive Agrarian Reform Law of 1988 or Republic
Act No. 6657 likewise contains a proviso supporting the
inapplicability of P.D. 27 to lands covered by homestead patents
like those of the property in question, reading,Section 6.
Retention Limits. Provided further, That original homestead
grantees or their direct compulsory heirs who still own the
original homestead at the time of the approval of this Act shall
retain the same areas as long as they continue to cultivate said
homestead.WHEREFORE, premises considered, the decision of the
respondent Court of Appeals sustaining the decision of the Regional
Trial Court is hereby AFFIRMED.SO ORDERED.Melencio-Herrera,
(Chairperson), Padilla, Sarmiento and Regalado, JJ.,
concur.Footnotes** Penned by Justice Jorge R. Coquia and concurred
in by Justices Josue N. Bellosillo and Venancio D. Aldecoa, Jr. of
the Fourth Division. Republic of thePhilippinesSupreme
CourtManilaSECOND DIVISIONMilestone Farms, Inc., v. Office of the
President, G.R. No. 182332. February 23,
2011xxDECISIONNACHURA,J.:Before this Court is a Petition for Review
onCertiorari[1]under Rule 45 of the Rules of Civil Procedure,
seeking the reversal of the Court of Appeals (CA) Amended
Decision[2]dated October 4, 2006 and its Resolution[3]dated March
27, 2008.The FactsPetitioner Milestone Farms, Inc. (petitioner) was
incorporated with the Securities and Exchange Commission on January
8, 1960.[4]Among its pertinent secondary purposes are:(1)to engage
in the raising of cattle, pigs, and other livestock; to acquire
lands by purchase or lease, which may be needed for this purpose;
and to sell and otherwise dispose of said cattle, pigs, and other
livestock and their produce when advisable and beneficial to the
corporation;(2)to breed, raise, and sell poultry; to purchase or
acquire and sell, or otherwise dispose of the supplies, stocks,
equipment, accessories, appurtenances, products, and by-products of
said business; and (3)to import cattle, pigs, and other livestock,
and animal food necessary for the raising of said cattle, pigs, and
other livestock as may be authorized by law.[5]On June 10, 1988, a
new agrarian reform law, Republic Act (R.A.) No. 6657, otherwise
known as the Comprehensive Agrarian Reform Law (CARL), took effect,
which included the raising of livestock, poultry, and swine in its
coverage. However, on December 4, 1990, this Court, sittingen banc,
ruled inLuz Farms v. Secretary of the Department of Agrarian
Reform[6]that agricultural lands devoted to livestock, poultry,
and/or swine raising are excluded from the Comprehensive Agrarian
Reform Program (CARP).Thus, in May 1993, petitioner applied for the
exemption/exclusion of its 316.0422-hectare property, covered by
Transfer Certificate of Title Nos. (T-410434) M-15750, (T-486101)
M-7307, (T-486102) M-7308, (T-274129) M-15751, (T-486103) M-7309,
(T-486104) M-7310, (T-332694) M-15755, (T-486105) M-7311,
(T-486106) M-7312, M-8791, (T-486107) M-7313, (T-486108) M-7314,
M-8796, (T-486109) M-7315, (T-486110) M-9508, and M-6013, and
located in Pinugay, Baras, Rizal, from the coverage of the CARL,
pursuant to the aforementioned ruling of this Court inLuz
Farms.Meanwhile, on December 27, 1993, the Department of Agrarian
Reform (DAR) issued Administrative Order No. 9, Series of 1993 (DAR
A.O. No. 9), setting forth rules and regulations to govern the
exclusion of agricultural lands used for livestock, poultry, and
swine raising from CARP coverage. Thus, on January 10, 1994,
petitioner re-documented its application pursuant to DAR A.O. No.
9.[7]Acting on the said application, the DARs Land Use Conversion
and Exemption Committee (LUCEC) of Region IV conducted an ocular
inspection on petitioners property and arrived at the following
findings:[T]he actual land utilization for livestock, swine and
poultry is 258.8422 hectares; the area which served as
infrastructure is 42.0000 hectares; ten (10) hectares are planted
to corn and the remaining five (5) hectares are devoted to fish
culture; that the livestock population are 371 heads of cow, 20
heads of horses, 5,678 heads of swine and 788 heads of cocks; that
the area being applied for exclusion is far below the required or
ideal area which is 563 hectares for the total livestock
population; that the approximate area not directly used for
livestock purposes with an area of 15 hectares, more or less, is
likewise far below the allowable 10% variance; and, though not
directly used for livestock purposes, the ten (10) hectares planted
to sweet corn and the five (5) hectares devoted to fishpond could
be considered supportive to livestock production.The LUCEC, thus,
recommended the exemption of petitioners 316.0422-hectare property
from the coverage of CARP. Adopting the LUCECs findings and
recommendation, DAR Regional Director Percival Dalugdug (Director
Dalugdug) issued an Order dated June 27, 1994, exempting
petitioners 316.0422-hectare property from CARP.[8]The Southern
Pinugay Farmers Multi-Purpose Cooperative, Inc. (Pinugay Farmers),
represented by Timiano Balajadia, Sr. (Balajadia), moved for the
reconsideration of the said Order, but the same was denied by
Director Dalugdug in his Order dated November 24,
1994.[9]Subsequently, the Pinugay Farmers filed a letter-appeal
with the DAR Secretary.Correlatively, on June 4, 1994, petitioner
filed a complaint for Forcible Entry against Balajadia and company
before the Municipal Circuit Trial Court (MCTC) of Teresa-Baras,
Rizal, docketed as Civil Case No. 781-T.[10]The MCTC ruled in favor
of petitioner, but the decision was later reversed by the Regional
Trial Court, Branch 80, of Tanay, Rizal. Ultimately, the case
reached the CA, which, in its Decision[11]dated October 8, 1999,
reinstated the MCTCs ruling, ordering Balajadia and all defendants
therein to vacate portions of the property covered by TCT Nos.
M-6013, M-8796, and M-8791. In its Resolution[12]dated July 31,
2000, the CA held that the defendants therein failed to timely file
a motion for reconsideration, given the fact that their counsel of
record received its October 8, 1999 Decision; hence, the same
became final and executory.In the meantime, R.A. No. 6657 was
amended by R.A. No. 7881,[13]which was approved on February 20,
1995. Private agricultural lands devoted to livestock, poultry, and
swine raising were excluded from the coverage of the CARL.On
October 22, 1996, the fact-finding team formed by the DAR
Undersecretary for Field Operations and Support Services conducted
an actual headcount of the livestock population on the property.The
headcount showed that there were 448 heads of cattle and more than
5,000 heads of swine.
The DAR Secretarys RulingOn January 21, 1997, then DAR Secretary
Ernesto D. Garilao (Secretary Garilao) issued an Order exempting
from CARP only 240.9776 hectares of the 316.0422 hectares
previously exempted by Director Dalugdug, and declaring 75.0646
hectares of the property to be covered by CARP.[14]Secretary
Garilao opined that, for private agricultural lands to be excluded
from CARP, they must already be devoted to livestock, poultry, and
swine raising as of June 15, 1988, when the CARL took effect.He
found that the Certificates of Ownership of Large Cattle submitted
by petitioner showed that only 86 heads of cattle were registered
in the name of petitioners president, Misael Vera, Jr., prior to
June 15, 1988; 133 were subsequently bought in 1990, while 204 were
registered from 1992 to 1995.Secretary Garilao gave more weight to
the certificates rather than to the headcount because the same
explicitly provide for the number of cattle owned by petitioner as
of June 15, 1988.Applying the animal-land ratio (1 hectare for
grazing for every head of cattle/carabao/horse) and the
infrastructure-animal ratio (1.7815 hectares for 21 heads of
cattle/carabao/horse, and 0.5126 hectare for 21 heads of hogs)
under DAR A.O. No. 9, Secretary Garilao exempted 240.9776 hectares
of the property, as follows:1. 86 hectares for the 86 heads of
cattle existing as of 15 June 1988;2. 8 hectares for infrastructure
following the ratio of 1.7815 hectares for every 21 heads of
cattle;3. 8 hectares for the 8 horses;4. 0.3809 square meters of
infrastructure for the 8 horses; [and]5. 138.5967 hectares for the
5,678 heads of swine.[15]Petitioner filed a Motion for
Reconsideration,[16]submitting therewith copies of Certificates of
Transfer of Large Cattle and additional Certificates of Ownership
of Large Cattle issued to petitioner prior to June 15, 1988, as
additional proof that it had met the required animal-land ratio.
Petitioner also submitted a copy of a Disbursement Voucher dated
December 17, 1986, showing the purchase of 100 heads of cattle by
the Bureau of Animal Industry from petitioner, as further proof
that it had been actively operating a livestock farm even before
June 15, 1988.However, in his Order dated April 15, 1997, Secretary
Garilao denied petitioners Motion for
Reconsideration.[17]Aggrieved, petitioner filed its Memorandum on
Appeal[18]before the Office of the President (OP).The OPs RulingOn
February 4, 2000, the OP rendered a decision[19]reinstating
Director Dalugdugs Order dated June 27, 1994 and declared the
entire 316.0422-hectare property exempt from the coverage of
CARP.However, on separate motions for reconsideration of the
aforesaid decision filed by farmer-groups Samahang Anak-Pawis ng
Lagundi (SAPLAG) and Pinugay Farmers, and the Bureau of Agrarian
Legal Assistance of DAR, the OP issued a resolution[20]dated
September 16, 2002, setting aside its previous decision. The
dispositive portion of the OP resolution reads:WHEREFORE, the
Decision subject of the instant separate motions for
reconsideration is hereby SET ASIDE and a new one entered
REINSTATING the Order dated 21 January 1997 of then DAR Secretary
Ernesto D. Garilao, as reiterated in another Order of 15 April
1997, without prejudice to the outcome of the continuing review and
verification proceedings that DAR, thru the appropriate Municipal
Agrarian Reform Officer, may undertake pursuant to Rule III (D) of
DAR Administrative Order No. 09, series of 1993.SO ORDERED.[21]The
OP held that, when it comes to proof of ownership, the reference is
the Certificate of Ownership of Large Cattle. Certificates of
cattle ownership, which are readily available being issued by the
appropriate government office ought to match the number of heads of
cattle counted as existing during the actual headcount.The presence
of large cattle on the land, without sufficient proof of ownership
thereof, only proves such presence.Taking note of Secretary
Garilaos observations, the OP also held that, before an ocular
investigation is conducted on the property, the landowners are
notified in advance; hence, mere reliance on the physical headcount
is dangerous because there is a possibility that the landowners
would increase the number of their cattle for headcount purposes
only. The OP observed that there was a big variance between the
actual headcount of 448 heads of cattle and only 86 certificates of
ownership of large cattle.Consequently, petitioner sought recourse
from the CA.[22]
The Proceedings Before the CA and Its RulingsOn April 29, 2005,
the CA found that, based on the documentary evidence presented, the
property subject of the application for exclusion had more than
satisfied the animal-land and infrastructure-animal ratios under
DAR A.O. No. 9. The CA also found that petitioner applied for
exclusion long before the effectivity of DAR A.O. No. 9, thus,
negating the claim that petitioner merely converted the property
for livestock, poultry, and swine raising in order to exclude it
from CARP coverage. Petitioner was held to have actually engaged in
the said business on the property even before June 15, 1988. The CA
disposed of the case in this wise:WHEREFORE, the instant petition
is herebyGRANTED.The assailedResolutionof the Office of the
President dated September 16, 2002 is herebySET ASIDE, and
itsDecisiondated February 4, 2000 declaring the entire 316.0422
hectares exempt from the coverage of the Comprehensive Agrarian
Reform Program is herebyREINSTATEDwithout prejudice to the outcome
of the continuing review and verification proceedings which the
Department of Agrarian Reform, through the proper Municipal
Agrarian Reform Officer, may undertake pursuant to Policy Statement
(D) of DAR Administrative Order No. 9, Series of 1993.SO
ORDERED.[23]Meanwhile, six months earlier, or on November 4, 2004,
without the knowledge of the CA as the parties did not inform the
appellate court then DAR Secretary Rene C. Villa (Secretary Villa)
issued DAR Conversion Order No. CON-0410-0016[24](Conversion
Order), granting petitioners application to convert portions of the
316.0422-hectare property from agricultural to residential and golf
courses use. The portions converted with a total area of 153.3049
hectares were covered by TCT Nos. M-15755 (T-332694), M-15751
(T-274129), and M-15750 (T-410434). With this Conversion Order, the
area of the property subject of the controversy was effectively
reduced to 162.7373 hectares.On the CAs decision of April 29, 2005,
Motions for Reconsideration were filed by farmer-groups, namely:the
farmers represented by Miguel Espinas[25](Espinas group), the
Pinugay Farmers,[26]and the SAPLAG.[27]The farmer-groups all
claimed that the CA should have accorded respect to the factual
findings of the OP. Moreover, the farmer-groups unanimously
intimated that petitioner already converted and developed a portion
of the property into a leisure-residential-commercial estate known
as the Palo Alto Leisure and Sports Complex (Palo
Alto).Subsequently, in a Supplement to the Motion for
Reconsideration on Newly Secured Evidence pursuant to DAR
Administrative Order No. 9, Series of 1993[28](Supplement) dated
June 15, 2005, the Espinas group submitted the following as
evidence:1) Conversion Order[29]dated November 4, 2004, issued by
Secretary Villa, converting portions of the property from
agricultural to residential and golf courses use, with a total area
of 153.3049 hectares; thus, the Espinas group prayed that the
remaining 162.7373 hectares (subject property) be covered by the
CARP;2)Letter[30]dated June 7, 2005 of both incoming Municipal
Agrarian Reform Officer (MARO) Bismark M. Elma (MARO Elma) and
outgoing MARO Cesar C. Celi (MARO Celi) of Baras, Rizal, addressed
to Provincial Agrarian Reform Officer (PARO) II of Rizal,
Felixberto Q. Kagahastian, (MARO Report), informing the latter,
among others, that Palo Alto was already under development and the
lots therein were being offered for sale; that there were actual
tillers on the subject property; that there were agricultural
improvements thereon, including an irrigation system and road
projects funded by the Government; that there was no existing
livestock farm on the subject property; and that the same was not
in the possession and/or control of petitioner;
and3)Certification[31]dated June 8, 2005, issued by both MARO Elma
and MARO Celi, manifesting that the subject property was in the
possession and cultivation of actual occupants and tillers, and
that, upon inspection, petitioner maintained no livestock farm
thereon.Four months later, the Espinas group and the DAR filed
their respective Manifestations.[32]In its Manifestation dated
November 29, 2005, the DAR confirmed that the subject property was
no longer devoted to cattle raising. Hence, in its
Resolution[33]dated December 21, 2005, the CA directed petitioner
to file its comment on the Supplement and the aforementioned
Manifestations. Employing the services of a new counsel, petitioner
filed a Motion to Admit Rejoinder,[34]and prayed that the MARO
Report be disregarded and expunged from the records for lack of
factual and legal basis.With the CA now made aware of these
developments, particularly Secretary Villas Conversion Order of
November 4, 2004, the appellate court had to acknowledge that the
property subject of the controversy would now be limited to the
remaining 162.7373 hectares.In the same token, the Espinas group
prayed that this remaining area be covered by the CARP.[35]On
October 4, 2006, the CA amended its earlier Decision.It held that
its April 29, 2005 Decision was theoretically not final because DAR
A.O. No. 9 required the MARO to make a continuing review and
verification of the subject property. While the CA was cognizant of
our ruling inDepartment of Agrarian Reform v. Sutton,[36]wherein we
declared DAR A.O. No. 9 as unconstitutional, it still resolved to
lift the exemption of the subject property from the CARP, not on
the basis of DAR A.O. No. 9, but on the strength of evidence such
as the MARO Report and Certification, and theKatunayan[37]issued by
thePunong Barangay, Alfredo Ruba (Chairman Ruba), of Pinugay,
Baras, Rizal, showing that the subject property was no longer
operated as a livestock farm. Moreover, the CA held that the lease
agreements,[38]which petitioner submitted to prove that it was
compelled to lease a ranch as temporary shelter for its cattle,
only reinforced the DARs finding that there was indeed no existing
livestock farm on the subject property. While petitioner claimed
that it was merely forced to do so to prevent further slaughtering
of its cattle allegedly committed by the occupants, the CA found
the claim unsubstantiated. Furthermore, the CA opined that
petitioner should have asserted its rights when the irrigation and
road projects were introduced by the Government within its
property. Finally, the CA accorded the findings of MARO Elma and
MARO Celi the presumption of regularity in the performance of
official functions in the absence of evidence proving misconduct
and/or dishonesty when they inspected the subject property and
rendered their report. Thus, the CA disposed:WHEREFORE, this
CourtsDecisiondated April 29, 2005 is hereby amended in that the
exemption of the subject landholding from the coverage of the
Comprehensive Agrarian Reform Program is hereby lifted, and the
162.7373 hectare-agricultural portion thereof is hereby declared
covered by the Comprehensive Agrarian Reform Program.SO
ORDERED.[39]Unperturbed, petitioner filed a Motion for
Reconsideration.[40]On January 8, 2007, MARO Elma, in compliance
with the Memorandum of DAR Regional Director Dominador B. Andres,
tendered another Report[41]reiterating that, upon inspection of the
subject property, together with petitioners counsel-turned witness,
Atty. Grace Eloisa J. Que (Atty. Que), PARO Danilo M. Obarse,
Chairman Ruba, and several occupants thereof, he, among others,
found no livestock farm within the subject property. About 43 heads
of cattle were shown, but MARO Elma observed that the same were
inside an area adjacent toPalo Alto. Subsequently, upon Atty. Ques
request for reinvestigation, designated personnel of the DAR
Provincial and Regional Offices (Investigating Team) conducted
another ocular inspection on the subject property on February 20,
2007. The Investigating Team, in its Report[42]dated February 21,
2007, found that, per testimony of petitioners caretaker, Rogelio
Ludivices (Roger),[43]petitioner has 43 heads of cattle taken care
of by the following individuals: i) Josefino Custodio (Josefino) 18
heads; ii) Andy Amahit 15 heads; and iii) Bert Pangan 2 heads; that
these individuals pastured the herd of cattle outside the subject
property, while Roger took care of 8 heads of cattle inside the
Palo Alto area; that 21 heads of cattle owned by petitioner were
seen in the area adjacent to Palo Alto; that Josefino confirmed to
the Investigating Team that he takes care of 18 heads of cattle
owned by petitioner; that the said Investigating Team saw 9 heads
of cattle in the Palo Alto area, 2 of which bore MFI marks; and
that the 9 heads of cattle appear to have matched the Certificates
of Ownership of Large Cattle submitted by petitioner.Because of the
contentious factual issues and the conflicting averments of the
parties, the CA set the case for hearing and reception of evidence
on April 24, 2007.[44]Thereafter, as narrated by the CA, the
following events transpired:On May 17, 2007, [petitioner] presented
theJudicial Affidavitsof its witnesses, namely, [petitioners]
counsel, [Atty. Que], and the alleged caretaker of [petitioners]
farm, [Roger], who were both cross-examined by counsel for
farmers-movants and SAPLAG.[Petitioner] and SAPLAG then marked
their documentary exhibits.On May 24, 2007, [petitioners] security
guard and third witness, Rodolfo G. Febrada, submitted hisJudicial
Affidavitand was cross-examined by counsel for fa[r]mers-movants
and SAPLAG.Farmers-movants also marked their documentary
exhibits.Thereafter, the parties submitted their respectiveFormal
Offers of Evidence.Farmers-movants and SAPLAG filed
theirobjectionsto [petitioners]Formal Offer of Evidence.Later,
[petitioner] and farmers-movants filed their respectiveMemoranda.In
December 2007, this Court issued aResolutionon the parties offer of
evidence and considered [petitioners]Motion for
Reconsiderationsubmitted for resolution.[45]Finally, petitioners
motion for reconsideration was denied by the CA in its
Resolution[46]dated March 27, 2008. The CA discarded petitioners
reliance onSutton. It ratiocinated that the MARO Reports and the
DARs Manifestation could not be disregarded simply because DAR A.O.
No. 9 was declared unconstitutional. TheSuttonruling was premised
on the fact that theSuttonproperty continued to operate as a
livestock farm. The CA also reasoned that, inSutton, this Court did
not remove from the DAR the power to implement the CARP, pursuant
to the latters authority to oversee the implementation of agrarian
reform laws under Section 50[47]of the CARL. Moreover, the CA
found:Petitioner-appellant claimed that they had 43 heads of cattle
which are being cared for and pastured by 4 individuals.To prove
its ownership of the said cattle, petitioner-appellant offered in
evidence 43Certificates of Ownership of Large Cattle.Significantly,
however, the saidCertificateswere all dated and issued on November
24, 2006, nearly 2 months after this Court rendered itsAmended
Decisionlifting the exemption of the 162-hectare portion of the
subject landholding.The acquisition of such cattle after the
lifting of the exemption clearly reveals that petitioner-appellant
was no longer operating a livestock farm, and suggests an effort to
create a semblance of livestock-raising for the purpose of
itsMotion for Reconsideration.[48]On petitioners assertion that
between MARO Elmas Report dated January 8, 2007 and the
Investigating Teams Report, the latter should be given credence,
the CA held that there were no material inconsistencies between the
two reports because both showed that the 43 heads of cattle were
found outside the subject property.Hence, this Petition assigning
the following errors:THE HONORABLE COURT OF APPEALS GRAVELY ERRED
WHEN IT HELD THAT LANDS DEVOTED TO LIVESTOCK FARMING WITHIN THE
MEANING OFLUZ FARMSANDSUTTON, AND WHICH ARE THEREBY EXEMPT FROM
CARL COVERAGE, ARE NEVERTHELESS SUBJECT TO DARS CONTINUING
VERIFICATION AS TO USE, AND, ON THE BASIS OF SUCH VERIFICATION, MAY
BE ORDERED REVERTED TO AGRICULTURAL CLASSIFICATION AND COMPULSORY
ACQUISITION[;]GRANTING THAT THE EXEMPT LANDS AFORESAID MAY BE SO
REVERTED TO AGRICULTURAL CLASSIFICATION, STILL THE PROCEEDINGS FOR
SUCH PURPOSE BELONGS TO THE EXCLUSIVE ORIGINAL JURISDICTION OF THE
DAR, BEFORE WHICH THE CONTENDING PARTIES MAY VENTILATE FACTUAL
ISSUES, AND AVAIL THEMSELVES OF USUAL REVIEW PROCESSES, AND NOT TO
THE COURT OF APPEALS EXERCISING APPELLATE JURISDICTION OVER ISSUES
COMPLETELY UNRELATED TO REVERSION [; AND]IN ANY CASE, THE COURT OF
APPEALS GRAVELY ERRED AND COMMITTED GRAVE ABUSE OF DISCRETION WHEN
IT HELD THAT THE PROPERTY IN DISPUTE IS NO LONGER BEING USED FOR
LIVESTOCK FARMING.[49]Petitioner asseverates that lands devoted to
livestock farming as of June 15, 1988 are classified as industrial
lands, hence, outside the ambit of the CARP; thatLuz Farms,Sutton,
and R.A. No. 7881 clearly excluded such lands on constitutional
grounds; that petitioners lands were actually devoted to livestock
even before the enactment of the CARL; that livestock farms are
exempt from the CARL, not by reason of any act of the DAR, but
because of their nature as industrial lands; that petitioners
property was admittedly devoted to livestock farming as of June
1988 and the only issue before was whether or not petitioners
pieces of evidence comply with the ratios provided under DAR A.O.
No. 9; and that DAR A.O. No. 9 having been declared as
unconstitutional, DAR had no more legal basis to conduct a
continuing review and verification proceedings over livestock
farms. Petitioner argues that, in cases where reversion of
properties to agricultural use is proper, only the DAR has the
exclusive original jurisdiction to hear and decide the same; hence,
the CA, in this case, committed serious errors when it ordered the
reversion of the property and when it considered pieces of evidence
not existing as of June 15, 1988, despite its lack of jurisdiction;
that the CA should have remanded the case to the DAR due to
conflicting factual claims; that the CA cannot ventilate
allegations of fact that were introduced for the first time on
appeal as a supplement to a motion for reconsideration of its first
decision, use the same to deviate from the issues pending review,
and, on the basis thereof, declare exempt lands reverted to
agricultural use and compulsorily covered by the CARP; that the
newly discovered [pieces of] evidence were not introduced in the
proceedings before the DAR, hence, it was erroneous for the CA to
consider them; and that piecemeal presentation of evidence is not
in accord with orderly justice. Finally, petitioner submits that,
in any case, the CA gravely erred and committed grave abuse of
discretion when it held that the subject property was no longer
used for livestock farming as shown by the Report of the
Investigating Team. Petitioner relies on the 1997 LUCEC and DAR
findings that the subject property was devoted to livestock
farming, and on the 1999 CA Decision which held that the occupants
of the property were squatters, bereft of any authority to stay and
possess the property.[50]On one hand, the farmer-groups,
represented by the Espinas group, contend that they have been
planting rice and fruit-bearing trees on the subject property, and
helped the National Irrigation Administration in setting up an
irrigation system therein in 1997, with a produce of 1,500 to 1,600
sacks ofpalayeach year; that petitioner came to court with unclean
hands because, while it sought the exemption and exclusion of the
entire property, unknown to the CA, petitioner surreptitiously
filed for conversion of the property now known as Palo Alto, which
was actually granted by the DAR Secretary; that petitioners bad
faith is more apparent since, despite the conversion of the
153.3049-hectare portion of the property, it still seeks to exempt
the entire property in this case; and that the fact that petitioner
applied for conversion is an admission that indeed the property is
agricultural. The farmer-groups also contend that petitioners
reliance onLuz FarmsandSuttonis unavailing because in these cases
there was actually no cessation of the business of raising cattle;
that what is being exempted is the activity of raising cattle and
not the property itself; that exemptions due to cattle raising are
not permanent; that the declaration of DAR A.O. No. 9 as
unconstitutional does not at all diminish the mandated duty of the
DAR, as the lead agency of the Government, to implement the CARL;
that the DAR, vested with the power to identify lands subject to
CARP, logically also has the power to identify lands which are
excluded and/or exempted therefrom; that to disregard DARs
authority on the matter would open the floodgates to abuse and
fraud by unscrupulous landowners; that the factual finding of the
CA that the subject property is no longer a livestock farm may not
be disturbed on appeal, as enunciated by this Court; that DAR
conducted a review and monitoring of the subject property by virtue
of its powers under the CARL; and that the CA has sufficient
discretion to admit evidence in order that it could arrive at a
fair, just, and equitable ruling in this case.[51]On the other
hand, respondent OP, through the Office of the Solicitor General
(OSG), claims that the CA correctly held that the subject property
is not exempt from the coverage of the CARP, as substantial pieces
of evidence show that the said property is not exclusively devoted
to livestock, swine, and/or poultry raising; that the issues
presented by petitioner are factual in nature and not proper in
this case; that under Rule 43 of the 1997 Rules of Civil Procedure,
questions of fact may be raised by the parties and resolved by the
CA; that due to the divergence in the factual findings of the DAR
and the OP, the CA was duty bound to review and ascertain which of
the said findings are duly supported by substantial evidence; that
the subject property was subject to continuing review and
verification proceedings due to the then prevailing DAR A.O. No. 9;
that there is no question that the power to determine if a property
is subject to CARP coverage lies with the DAR Secretary; that
pursuant to such power, the MARO rendered the assailed reports and
certification, and the DAR itself manifested before the CA that the
subject property is no longer devoted to livestock farming; and
that, while it is true that this Courts ruling inLuz Farmsdeclared
that agricultural lands devoted to livestock, poultry, and/or swine
raising are excluded from the CARP, the said ruling is not without
any qualification.[52]In its Reply[53]to the farmer-groups and to
the OSGs comment, petitioner counters that the farmer-groups have
no legal basis to their claims as they admitted that they entered
the subject property without the consent of petitioner; that the
rice plots actually found in the subject property, which were
subsequently taken over by squatters, were, in fact, planted by
petitioner in compliance with the directive of then President
Ferdinand Marcos for the employer to provide rice to its employees;
that when a land is declared exempt from the CARP on the ground
that it is not agricultural as of the time the CARL took effect,
the use and disposition of that land is entirely and forever beyond
DARs jurisdiction; and that, inasmuch as the subject property was
not agricultural from the very beginning, DAR has no power to
regulate the same. Petitioner also asserts that the CA cannot
uncharacteristically assume the role of trier of facts and resolve
factual questions not previously adjudicated by the lower
tribunals; that MARO Elma rendered the assailed MARO reports with
bias against petitioner, and the same were contradicted by the
Investigating Teams Report, which confirmed that the subject
property is still devoted to livestock farming; and that there has
been no change in petitioners business interest as an entity
engaged in livestock farming since its inception in 1960, though
there was admittedly a decline in the scale of its operations due
to the illegal acts of the squatter-occupants.Our RulingThe
Petition is bereft of merit.Let it be stressed that when the CA
provided in its first Decision that continuing review and
verification may be conducted by the DAR pursuant to DAR A.O. No.
9, the latter was not yet declared unconstitutional by this Court.
The first CA Decision was promulgated on April 29, 2005, while this
Court struck down as unconstitutional DAR A.O. No. 9, by way
ofSutton,on October 19, 2005. Likewise, let it be emphasized that
the Espinas group filed the Supplement and submitted the assailed
MARO reports and certification on June 15, 2005, which proved to be
adverse to petitioners case. Thus, it could not be said that the CA
erred or gravely abused its discretion in respecting the mandate of
DAR A.O. No. 9, which was then subsisting and in full force and
effect.While it is true that an issue which was neither alleged in
the complaint nor raised during the trial cannot be raised for the
first time on appeal as it would be offensive to the basic rules of
fair play, justice, and due process,[54]the same is not without
exception,[55]such as this case. The CA, under Section 3,[56]Rule
43 of the Rules of Civil Procedure, can, in the interest of
justice, entertain and resolve factual issues. After all, technical
and procedural rules are intended to help secure, and not suppress,
substantial justice. A deviation from a rigid enforcement of the
rules may thus be allowed to attain the prime objective of
dispensing justice, for dispensation of justice is the core reason
for the existence of courts.[57]Moreover, petitioner cannot validly
claim that it was deprived of due process because the CA afforded
it all the opportunity to be heard.[58]The CA even directed
petitionerto file its comment on the Supplement, and to prove and
establish its claim that the subject property was excluded from the
coverage of the CARP.Petitioner actively participated in the
proceedings before the CA by submitting pleadings and pieces of
documentary evidence, such as the Investigating Teams Report and
judicial affidavits. The CA also went further by setting the case
for hearing. In all these proceedings, all the parties rights to
due process were amply protected and recognized.With the procedural
issue disposed of, we find that petitioners arguments fail to
persuade.Its invocation ofSuttonis unavailing. InSutton, we held: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 lands exclusively
devoted to livestock, swine and poultry-raising. The Court
clarified in theLuz Farmscase that livestock, swine and
poultry-raising are industrial activities and do not fall within
the definition of agriculture or agricultural activity. The raising
of livestock, swine and poultry is different from crop or tree
farming. It is an industrial, not an agricultural, activity. A
great portion of the investment in this enterprise is in the form
of industrial fixed assets, such as: animal housing structures and
facilities, drainage, waterers and blowers, feedmill with grinders,
mixers, conveyors, exhausts and generators, extensive warehousing
facilities for feeds and other supplies, anti-pollution equipment
like bio-gas and digester plants augmented by lagoons and concrete
ponds, deepwells, elevated water tanks, pumphouses, sprayers, and
other technological appurtenances.Clearly, petitionerDAR has no
power to regulate livestock farms which have been exempted by the
Constitution from the coverage of agrarian reform. It has exceeded
its power in issuing the assailed A.O.[59]Indeed, as pointed out by
the CA, the instant case does not rest on facts parallel to those
ofSuttonbecause, inSutton, the subject property remained a
livestock farm. We even highlighted therein the fact that there has
been no change of business interest in the case of
respondents.[60]Similarly, inDepartment of Agrarian Reform v.
Uy,[61]we excluded a parcel of land from CARP coverage due to the
factual findings of the MARO, which were confirmed by the DAR, that
the property was entirely devoted to livestock farming. However,
inA.Z. Arnaiz Realty, Inc., represented by Carmen Z. Arnaiz v.
Office of the President; Department of Agrarian Reform; Regional
Director, DAR Region V, Legaspi City; Provincial Agrarian Reform
Officer, DAR Provincial Office, Masbate, Masbate; and Municipal
Agrarian Reform Officer, DAR Municipal Office, Masbate,
Masbate,[62]we denied a similar petition for exemption and/or
exclusion, by according respect to the CAs factual findings and
itsrelianceon the findings of the DAR and the OP thatthe
subjectparcels of land were not directly, actually, and exclusively
used for pasture.[63]Petitioners admission that, since 2001, it
leased another ranch for its own livestock is fatal to its
cause.[64]While petitioner advances a defense that it leased this
ranch because the occupants of the subject property harmed its
cattle, like the CA, we find it surprising that not even a single
police and/orbarangayreport was filed by petitioner to amplify its
indignation over these alleged illegal acts. Moreover, we accord
respect to the CAs keen observation that the assailed MARO reports
and the Investigating Teams Report do not actually contradict one
another, finding that the 43 cows, while owned by petitioner, were
actually pastured outside the subject property.Finally, it is
established that issues of Exclusion and/or Exemption are
characterized as Agrarian Law Implementation (ALI) cases which are
well within the DAR Secretarys competence and
jurisdiction.[65]Section 3, Rule II of the 2003 Department of
Agrarian Reform Adjudication Board Rules of Procedure
provides:Section 3.Agrarian Law Implementation Cases.The
Adjudicator or the Board shall have no jurisdiction over matters
involving the administrative implementation of RA No. 6657,
otherwise known as the Comprehensive Agrarian Reform Law (CARL) of
1988 and other agrarian laws as enunciated by pertinent rules and
administrative orders, which shall be under the exclusive
prerogative of and cognizable by the Office of the Secretary of the
DAR in accordance with his issuances, to wit:x x x x3.8Exclusion
from CARP coverage of agricultural land used for livestock, swine,
and poultry raising.Thus, we cannot, without going against the law,
arbitrarily strip the DAR Secretary of his legal mandate to
exercise jurisdiction and authority over all ALI cases. To succumb
to petitioners contention that when a land is declared exempt from
the CARP on the ground that it is not agricultural as of the time
the CARL took effect, the use and disposition of that land is
entirely and forever beyond DARs jurisdiction is dangerous,
suggestive of self-regulation. Precisely, it is the DAR Secretary
who is vested with such jurisdiction and authority to exempt and/or
exclude a property from CARP coverage based on the factual
circumstances of each case and in accordance with law and
applicable jurisprudence. In addition, albeit parenthetically,
Secretary Villa had already granted the conversion into residential
and golf courses use of nearly one-half of the entire area
originally claimed as exempt from CARP coverage because it was
allegedly devoted to livestock production.In sum, we find no
reversible error in the assailed Amended Decision and Resolution of
the CA which would warrant the modification, much less the
reversal, thereof.WHEREFORE, the Petition isDENIEDand theCourt of
Appeals Amended Decision dated October 4, 2006 and Resolution dated
March 27, 2008 areAFFIRMED. No costs.SO ORDERED.
EN BANC[G.R. No. 86889 :December 4, 1990.]192 SCRA 51LUZ FARMS,
Petitioner, vs.THE HONORABLE SECRETARY OF THE DEPARTMENT OF
AGRARIAN REFORM, Respondent.D E C I S I O NPARAS,J.:This is a
petition for prohibition with prayer for restraining order and/or
preliminary and permanent injunction against the Honorable
Secretary of the Department of Agrarian Reform for acting without
jurisdiction in enforcing the assailed provisions of R.A. No. 6657,
otherwise known as the Comprehensive Agrarian Reform Law of 1988
and in promulgating the Guidelines and Procedure Implementing
Production and Profit Sharing under R.A. No. 6657, insofar as the
same apply to herein petitioner, and further from performing an act
in violation of the constitutional rights of the petitioner.As
gathered from the records, the factual background of this case, is
as follows:On June 10, 1988, the President of the Philippines
approved R.A. No. 6657, which includes the raising of livestock,
poultry and swine in its coverage (Rollo, p. 80).On January 2,
1989, the Secretary of Agrarian Reform promulgated the Guidelines
and Procedures Implementing Production and Profit Sharing as
embodied in Sections 13 and 32 of R.A. No. 6657 (Rollo, p. 80).On
January 9, 1989, the Secretary of Agrarian Reform promulgated its
Rules and Regulations implementing Section 11 of R.A. No. 6657
(Commercial Farms). (Rollo, p. 81).Luz Farms, petitioner in this
case, is a corporation engaged in the livestock and poultry
business and together with others in the same business allegedly
stands to be adversely affected by the enforcement of Section 3(b),
Section 11, Section 13, Section 16(d) and 17 and Section 32 of R.A.
No. 6657 otherwise known as Comprehensive Agrarian Reform Law and
of the Guidelines and Procedures Implementing Production and Profit
Sharing under R.A. No. 6657 promulgated on January 2, 1989 and the
Rules and Regulations Implementing Section 11 thereof as
promulgated by the DAR on January 9, 1989 (Rollo, pp. 2-36).:
rdHence, this petition praying that aforesaid laws, guidelines and
rules be declared unconstitutional. Meanwhile, it is also prayed
that a writ of preliminary injunction or restraining order be
issued enjoining public respondents from enforcing the same,
insofar as they are made to apply to Luz Farms and other livestock
and poultry raisers.This Court in its Resolution dated July 4, 1939
resolved to deny, among others, Luz Farms' prayer for the issuance
of a preliminary injunction in its Manifestation dated May 26, and
31, 1989. (Rollo, p. 98).Later, however, this Court in its
Resolution dated August 24, 1989 resolved to grant said Motion for
Reconsideration regarding the injunctive relief, after the filing
and approval by this Court of an injunction bond in the amount of
P100,000.00. This Court also gave due course to the petition and
required the parties to file their respective memoranda (Rollo, p.
119).The petitioner filed its Memorandum on September 6, 1989
(Rollo, pp. 131-168).On December 22, 1989, the Solicitor General
adopted his Comment to the petition as his Memorandum (Rollo, pp.
186-187).Luz Farms questions the following provisions of R.A. 6657,
insofar as they are made to apply to it:(a) Section 3(b) which
includes the "raising of livestock (and poultry)" in the definition
of "Agricultural, Agricultural Enterprise or Agricultural
Activity."(b) Section 11 which defines "commercial farms" as
"private agricultural lands devoted to commercial, livestock,
poultry and swine raising . . ."(c) Section 13 which calls upon
petitioner to execute a production-sharing plan.(d) Section 16(d)
and 17 which vest on the Department of Agrarian Reform the
authority to summarily determine the just compensation to be paid
for lands covered by the Comprehensive Agrarian Reform Law.(e)
Section 32 which spells out the production-sharing plan mentioned
in Section 13 ". . . (W)hereby three percent (3%) of the gross
sales from the production of such lands are distributed within
sixty (60) days of the end of the fiscal year as compensation to
regular and other farmworkers in such lands over and above the
compensation they currently receive: Provided, That these
individuals or entities realize gross sales in excess of five
million pesos per annum unless the DAR, upon proper application,
determine a lower ceiling.In the event that the individual or
entity realizes a profit, an additional ten (10%) of the net profit
after tax shall be distributed to said regular and other
farmworkers within ninety (90) days of the end of the fiscal year .
. ."The main issue in this petition is the constitutionality of
Sections 3(b), 11, 13 and 32 of R.A. No. 6657 (the Comprehensive
Agrarian Reform Law of 1988), insofar as the said law includes the
raising of livestock, poultry and swine in its coverage as well as
the Implementing Rules and Guidelines promulgated in accordance
therewith.:-cralawThe constitutional provision under consideration
reads as follows:ARTICLE XIIIxxxAGRARIAN AND NATURAL RESOURCES
REFORMSection 4. The State shall, by law, undertake an agrarian
reform program founded on the right of farmers and regular
farmworkers, who are landless, to own directly or collectively the
lands they till or, in the case of other farmworkers, to receive a
just share of the fruits thereof. To this end, the State shall
encourage and undertake the just distribution of all agricultural
lands, subject to such priorities and reasonable retention limits
as the Congress may prescribe, taking into account ecological,
developmental, or equity considerations, and subject to the payment
of just compensation. In determining retention limits, the State
shall respect the rights of small landowners. The State shall
further provide incentives for voluntary land-sharing.xxx"Luz Farms
contended that it does not seek the nullification of R.A. 6657 in
its entirety. In fact, it acknowledges the correctness of the
decision of this Court in the case of the Association of Small
Landowners in the Philippines, Inc. vs.Secretary of Agrarian Reform
(G.R. 78742, 14 July 1989) affirming the constitutionality of the
Comprehensive Agrarian Reform Law. It, however, argued that
Congress in enacting the said law has transcended the mandate of
the Constitution, in including land devoted to the raising of
livestock, poultry and swine in its coverage (Rollo, p. 131).
Livestock or poultry raising is not similar to crop or tree
farming. Land is not the primary resource in this undertaking and
represents no more than five percent (5%) of the total investment
of commercial livestock and poultry raisers. Indeed, there are many
owners of residential lands all over the country who use available
space in their residence for commercial livestock and raising
purposes, under "contract-growing arrangements," whereby processing
corporations and other commercial livestock and poultry raisers
(Rollo, p. 10). Lands support the buildings and other amenities
attendant to the raising of animals and birds. The use of land is
incidental to but not the principal factor or consideration in
productivity in this industry. Including backyard raisers, about
80% of those in commercial livestock and poultry production occupy
five hectares or less. The remaining 20% are mostly corporate farms
(Rollo, p. 11).On the other hand, the public respondent argued that
livestock and poultry raising is embraced in the term "agriculture"
and the inclusion of such enterprise under Section 3(b) of R.A.
6657 is proper. He cited that Webster's International Dictionary,
Second Edition (1954), defines the following words:"Agriculture the
art or science of cultivating the ground and raising and harvesting
crops, often, including also, feeding, breeding and management of
livestock, tillage, husbandry, farming.It includes farming,
horticulture, forestry, dairying, sugarmaking . . .Livestock
domestic animals used or raised on a farm, especially for
profit.Farm a plot or tract of land devoted to the raising of
domestic or other animals." (Rollo, pp. 82-83).The petition is
impressed with merit.The question raised is one of constitutional
construction. The primary task in constitutional construction is to
ascertain and thereafter assure the realization of the purpose of
the framers in the adoption of the Constitution (J.M. Tuazon &
Co. vs.Land Tenure Administration, 31 SCRA 413 [1970]).:
rdAscertainment of the meaning of the provision of Constitution
begins with the language of the document itself. The words used in
the Constitution are to be given their ordinary meaning except
where technical terms are employed in which case the significance
thus attached to them prevails (J.M. Tuazon & Co. vs.Land
Tenure Administration, 31 SCRA 413 [1970]).It is generally held
that, in construing constitutional provisions which are ambiguous
or of doubtful meaning, the courts may consider the debates in the
constitutional convention as throwing light on the intent of the
framers of the Constitution. It is true that the intent of the
convention is not controlling by itself, but as its proceeding was
preliminary to the adoption by the people of the Constitution the
understanding of the convention as to what was meant by the terms
of the constitutional provision which was the subject of the
deliberation, goes a long way toward explaining the understanding
of the people when they ratified it (Aquino, Jr. v. Enrile, 59 SCRA
183 [1974]).The transcripts of the deliberations of the
Constitutional Commission of 1986 on the meaning of the word
"agricultural," clearly show that it was never the intention of the
framers of the Constitution to include livestock and poultry
industry in the coverage of the constitutionally-mandated agrarian
reform program of the Government.The Committee adopted the
definition of "agricultural land" as defined under Section 166 of
R.A. 3844, as laud devoted to any growth, including but not limited
to crop lands, saltbeds, fishponds, idle and abandoned land
(Record, CONCOM, August 7, 1986, Vol. III, p. 11).The intention of
the Committee is to limit the application of the word
"agriculture." Commissioner Jamir proposed to insert the word
"ARABLE" to distinguish this kind of agricultural land from such
lands as commercial and industrial lands and residential properties
because all of them fall under the general classification of the
word "agricultural". This proposal, however, was not considered
because the Committee contemplated that agricultural lands are
limited to arable and suitable agricultural lands and therefore, do
not include commercial, industrial and residential lands (Record,
CONCOM, August 7, 1986, Vol. III, p. 30).In the interpellation,
then Commissioner Regalado (now a Supreme Court Justice), posed
several questions, among others, quoted as follows:xxx"Line 19
refers to genuine reform program founded on the primary right of
farmers and farmworkers. I wonder if it means that leasehold
tenancy is thereby proscribed under this provision because it
speaks of the primary right of farmers and farmworkers to own
directly or collectively the lands they till. As also mentioned by
Commissioner Tadeo, farmworkers include those who work in piggeries
and poultry projects.I was wondering whether I am wrong in my
appreciation that if somebody puts up a piggery or a poultry
project and for that purpose hires farmworkers therein, these
farmworkers will automatically have the right to own eventually,
directly or ultimately or collectively, the land on which the
piggeries and poultry projects were constructed. (Record, CONCOM,
August 2, 1986, p. 618).xxxThe questions were answered and
explained in the statement of then Commissioner Tadeo, quoted as
follows:xxx"Sa pangalawang katanungan ng Ginoo ay medyo hindi kami
nagkaunawaan. Ipinaaalam ko kay Commissioner Regalado na hindi
namin inilagay ang agricultural worker sa kadahilanang kasama rito
ang piggery, poultry at livestock workers. Ang inilagay namin dito
ay farm worker kaya hindi kasama ang piggery, poultry at livestock
workers (Record, CONCOM, August 2, 1986, Vol. II, p. 621).It is
evident from the foregoing discussion that Section II of R.A. 6657
which includes "private agricultural lands devoted to commercial
livestock, poultry and swine raising" in the definition of
"commercial farms" is invalid, to the extent that the aforecited
agro-industrial activities are made to be covered by the agrarian
reform program of the State. There is simply no reason to include
livestock and poultry lands in the coverage of agrarian reform.
(Rollo, p. 21).Hence, there is merit in Luz Farms' argument that
the requirement in Sections 13 and 32 of R.A. 6657 directing
"corporate farms" which include livestock and poultry raisers to
execute and implement "production-sharing plans" (pending final
redistribution of their landholdings) whereby they are called upon
to distribute from three percent (3%) of their gross sales and ten
percent (10%) of their net profits to their workers as additional
compensation is unreasonable for being confiscatory, and therefore
violative of due process (Rollo, p. 21).:-cralawIt has been
established that this Court will assume jurisdiction over a
constitutional question only if it is shown that the essential
requisites of a judicial inquiry into such a question are first
satisfied. Thus, there must be an actual case or controversy
involving a conflict of legal rights susceptible of judicial
determination, the constitutional question must have been
opportunely raised by the proper party, and the resolution of the
question is unavoidably necessary to the decision of the case
itself (Association of Small Landowners of the Philippines, Inc. v.
Secretary of Agrarian Reform, G.R. 78742; Acuna v. Arroyo, G.R.
79310; Pabico v. Juico, G.R. 79744; Manaay v. Juico, G.R. 79777, 14
July 1989, 175 SCRA 343).However, despite the inhibitions pressing
upon the Court when confronted with constitutional issues, it will
not hesitate to declare a law or act invalid when it is convinced
that this must be done. In arriving at this conclusion, its only
criterion will be the Constitution and God as its conscience gives
it in the light to probe its meaning and discover its purpose.
Personal motives and political considerations are irrelevancies
that cannot influence its decisions. Blandishment is as ineffectual
as intimidation, for all the awesome power of the Congress and
Executive, the Court will not hesitate "to make the hammer fall
heavily," where the acts of these departments, or of any official,
betray the people's will as expressed in the Constitution
(Association of Small Landowners of the Philippines, Inc. v.
Secretary of Agrarian Reform, G.R. 78742; Acuna v. Arroyo, G.R.
79310; Pabico v. Juico, G.R. 79744; Manaay v. Juico, G.R. 79777, 14
July 1989).Thus, where the legislature or the executive acts beyond
the scope of its constitutional powers, it becomes the duty of the
judiciary to declare what the other branches of the government had
assumed to do, as void. This is the essence of judicial power
conferred by the Constitution "(I)n one Supreme Court and in such
lower courts as may be established by law" (Art. VIII, Section 1 of
the 1935 Constitution; Article X, Section I of the 1973
Constitution and which was adopted as part of the Freedom
Constitution, and Article VIII, Section 1 of the 1987 Constitution)
and which power this Court has exercised in many instances
(Demetria v. Alba, 148 SCRA 208 [1987]).PREMISES CONSIDERED, the
instant petition is hereby GRANTED. Sections 3(b), 11, 13 and 32 of
R.A. No. 6657 insofar as the inclusion of the raising of livestock,
poultry and swine in its coverage as well as the Implementing Rules
and Guidelines promulgated in accordance therewith, are hereby
DECLARED null and void for being unconstitutional and the writ of
preliminary injunction issued is hereby MADE permanent.SO
ORDERED.Fernan (C.J.), Narvasa, Melencio-Herrera, Gutierrez, Jr.,
Cruz, Gancayco, Padilla, Bidin, Grio-Aquino, Medialdea and
Regalado, JJ., concur.Feliciano, J., is on leave.Separate
OpinionsSARMIENTO, J., concurring:I agree that the petition be
granted.It is my opinion however that the main issue on the
validity of the assailed provisions of R.A. 6657 (the Comprehensive
Agrarian Reform Law of 1988) and its Implementing Rules and
Guidelines insofar as they include the raising of livestock,
poultry, and swine in their coverage cannot be simplistically
reduced to a question of constitutional construction.It is a
well-settled rule that construction and interpretation come only
after it has been demonstrated that application is impossible or
inadequate without them. A close reading however of the
constitutional text in point, specifically, Sec. 4, Art. XIII,
particularly the phrase, ". . . in case of other farmworkers, to
receive a just share of the fruits thereof," provides a basis for
the clear and possible coverage of livestock, poultry, and swine
raising within the ambit of the comprehensive agrarian reform
program. This accords with the principle that every presumption
should be indulged in favor of the constitutionality of a statute
and the court in considering the validity of a statute should give
it such reasonable construction as can be reached to bring it
within the fundamental law.1The presumption against
unconstitutionality, I must say, assumes greater weight when a
ruling to the contrary would, in effect, defeat the laudable and
noble purpose of the law, i.e., the welfare of the landless farmers
and farmworkers in the promotion of social justice, by the
expedient conversion of agricultural lands into livestock, poultry,
and swine raising by scheming landowners, thus, rendering the
comprehensive nature of the agrarian program merely illusory.The
instant controversy, I submit, boils down to the question of
whether or not the assailed provisions violate the equal protection
clause of the Constitution (Article II, section 1) which teaches
simply that all persons or things similarly situated should be
treated alike, both as to rights conferred and responsibilities
imposed.2There is merit in the contention of the petitioner that
substantial distinctions exist between land directed purely to
cultivation and harvesting of fruits or crops and land exclusively
used for livestock, poultry and swine raising, that make real
differences, to wit:xxxNo land is tilled and no crop is harvested
in livestock and poultry farming. There are no tenants nor
landlords, only employers and employees.Livestock and poultry do
not sprout from land nor are they "fruits of the land."Land is not
even a primary resource in this industry. The land input is
inconsequential that all the commercial hog and poultry farms
combined occupy less than one percent (1%) (0.4% for piggery, 0.2%
for poultry) of the 5.45 million hectares of land supposedly
covered by the CARP. And most farms utilize only 2 to 5 hectares of
land.: nadIn every respect livestock and poultry production is an
industrial activity. Its use of an inconsequential portion of land
is a mere incident of its operation, as in any other undertaking,
business or otherwise.The fallacy of defining livestock and poultry
production as an agricultural enterprise is nowhere more evident
when one considers that at least 95% of total investment in these
farms is in the form of fixed assets which are industrial in
nature.These include (1) animal housing structures and facilities
complete with drainage, waterers, blowers, misters and in some
cases even piped-in music; (2) feedmills complete with grinders,
mixers, conveyors, exhausts, generators, etc.; (3) extensive
warehousing facilities for feeds and other supplies; (4)
anti-pollution equipment such as bio-gas and digester plants
augmented by lagoons and concrete ponds; (5) deepwells, elevated
water tanks, pumphouses and accessory facilities; (6) modern
equipment such as sprayers, pregnancy testers, etc.; (7) laboratory
facilities complete with expensive tools and equipment; and a
myriad other such technologically advanced appurtances.How then can
livestock and poultry farmlands be arable when such are almost
totally occupied by these structures?The fallacy of equating the
status of livestock and poultry farmworkers with that of
agricultural tenants surfaces when one considers contribution to
output. Labor cost of livestock and poultry farms is no more than
4% of total operating cost. The 98% balance represents inputs not
obtained from the land nor provided by the farmworkers inputs such
as feeds and biochemicals (80% of the total cost), power cost, cost
of money and several others.Moreover, livestock and poultry
farmworkers are covered by minimum wage law rather than by tenancy
law. They are entitled to social security benefits where
tenant-farmers are not. They are paid fixed wages rather than crop
shares. And as in any other industry, they receive additional
benefits such as allowances, bonuses, and other incentives such as
free housing privileges, light and water.Equating livestock and
poultry farming with other agricultural activities is also
fallacious in the sense that like the manufacturing sector, it is a
market for, rather than a source of agricultural output. At least
60% of the entire domestic supply of corn is absorbed by livestock
and poultry farms. So are the by-products of rice (rice-bran),
coconut (copra meal), banana (banana pulp meal), and fish (fish
meal).3xxxIn view of the foregoing, it is clear that both kinds of
lands are not similarly situated and hence, cannot be treated
alike. Therefore, the assailed provisions which allow for the
inclusion of livestock and poultry industry within the coverage of
the agrarian reform program constitute invalid classification and
must accordingly be struck down as repugnant to the equal
protection clause of the Constitution.chanrobles virtual law
libraryEndnotesSARMIENTO, J., concurring:1. In re Guarina, 24 Phil.
37; Yu Cong Eng v. Trinidad, 70 L. ed., p. 1059.2. Ichong v.
Hernandez, 101 Phil. 1155.3. Rollo, 29-30.
EN BANCDEPARTMENT OF AGRARIAN G.R. No. 162070REFORM, represented
by SECRETARYJOSE MARI B. PONCE (OIC), Present: Petitioner,
Davide,C.J., Puno, Panganiban, Quisumbing, Ynares-Santiago,
Sandoval-Gutierrez, Carpio, versus Austria-Martinez, Corona, Carpio
Morales, Callejo, Sr., Azcuna, Tinga, Chico-Nazario and
Garcia,JJ.DELIA T. SUTTON, ELLA T.SUTTON-SOLIMAN and
Promulgated:HARRY T. SUTTON, Respondents. October 19, 2005x
xDECISIONPUNO,J.: This is a petition for review filed by the
Department of Agrarian Reform (DAR) of the Decision and Resolution
of the Court of Appeals, dated September 19, 2003 and February 4,
2004, respectively, which declared DAR Administrative Order (A.O.)
No. 9, series of 1993, null and void for being violative of the
Constitution. The case at bar involves a land in Aroroy, Masbate,
inherited by respondents which has been devoted exclusively to cow
and calf breeding. On October 26, 1987, pursuant to the then
existing agrarian reform program of the government, respondents
made a voluntary offer to sell (VOS)[1]their landholdings to
petitioner DAR to avail of certain incentives under the law.On June
10, 1988, a new agrarian law, Republic Act (R.A.) No. 6657, also
known as the Comprehensive Agrarian Reform Law (CARL) of 1988, took
effect. It included in its coverage farms used for raising
livestock, poultry and swine.On December 4, 1990, in anen
bancdecision in the case ofLuz Farms v. Secretary of DAR,[2]this
Court ruled that lands devoted to livestock and poultry-raising are
not included in the definition of agricultural land. Hence, we
declared as unconstitutional certain provisions of the CARL insofar
as they included livestock farms in the coverage of agrarian
reform.In view of theLuz Farms ruling,respondents filed with
petitioner DAR a formal request to withdraw their VOS as their
landholding was devoted exclusively to cattle-raising and thus
exempted from the coverage of the CARL.[3]On December 21, 1992, the
Municipal Agrarian Reform Officer of Aroroy, Masbate, inspected
respondents land and found that it was devoted solely to
cattle-raising and breeding. He recommended to the DAR Secretary
that it be exempted from the coverage of the CARL.On April 27,
1993, respondents reiterated to petitioner DAR the withdrawal of
their VOS and requested the return of the supporting papers they
submitted in connection therewith.[4] Petitioner ignored their
request.On December 27, 1993, DAR issuedA.O. No. 9, series of
1993,[5]which provided that only portions of private agricultural
lands used for the raising of livestock, poultry and swine as of
June 15, 1988 shall be excluded from the coverage of the CARL. In
determining the area of land to be excluded, the A.O. fixed the
following retention limits,viz: 1:1 animal-land ratio (i.e.,1
hectare of land per 1 head of animal shall be retained by the
landowner), and a ratio of 1.7815 hectares for livestock
infrastructure for every 21 heads of cattle shall likewise be
excluded from the operations of the CARL. On February 4, 1994,
respondents wrote the DAR Secretary and advised him to consider as
final and irrevocable the withdrawal of their VOS as, under theLuz
Farms doctrine,their entire landholding is exempted from the
CARL.[6] On September 14, 1995, then DAR Secretary Ernesto D.
Garilao issued an Order[7]partially granting the application of
respondents for exemption from the coverage of CARL. Applying the
retention limits outlined in the DAR A.O. No. 9, petitioner
exempted1,209 hectares of respondents land for grazing purposes,
and a maximum of 102.5635 hectares for infrastructure. Petitioner
ordered the rest of respondents landholding to be segregated and
placed under Compulsory Acquisition.Respondents moved for
reconsideration. They contend that their entire landholding should
be exempted as it is devoted exclusively to cattle-raising. Their
motion was denied.[8] They filed a notice of appeal[9]with the
Office of the President assailing: (1) the reasonableness and
validity of DAR A.O. No. 9, s. 1993, which provided for a ratio
between land and livestock in determining the land area qualified
for exclusion from the CARL, and (2) the constitutionality of DAR
A.O. No. 9, s. 1993, in view of theLuz Farms casewhich declared
cattle-raising lands excluded from the coverage of agrarian
reform.On October 9, 2001, the Office of the President affirmed the
impugned Order of petitioner DAR.[10]It ruled that DAR A.O. No. 9,
s. 1993, does not run counter to theLuz Farms caseas the A.O.
provided the guidelines to determine whether a certain parcel of
land is being used for cattle-raising. However,the issue on the
constitutionality of the assailed A.O. was left for the
determination of the courts as the sole arbiters of such issue. On
appeal, the Court of Appeals ruled in favor of the respondents. It
declared DAR A.O. No. 9, s. 1993, void for being contrary to the
intent of the 1987 Constitutional Commission to exclude livestock
farms from the land reform program of the government. The
dispositive portion reads:WHEREFORE,premises considered, DAR
Administrative Order No. 09, Series of 1993 is herebyDECLAREDnull
and void. The assailed order of the Office of the President dated
09 October 2001 in so far as it affirmed the Department of Agrarian
Reforms ruling that petitioners landholding is covered by the
agrarian reform program of the government isREVERSEDandSET ASIDE.SO
ORDERED.[11] Hence, this petition. The main issue in the case at
bar is the constitutionality of DAR A.O. No. 9, series of 1993,
which prescribes a maximum retention limit for owners of lands
devoted to livestock raising. Invoking its rule-making power under
Section 49 of the CARL, petitioner submits that it issued DAR A.O.
No. 9 to limit the area of livestock farm that may be retained by a
landowner pursuant to its mandate to place all public and private
agricultural lands under the coverage of agrarian reform.
Petitioner also contends that the A.O. seeks to remedy reports that
some unscrupulous landowners have converted their agricultural
farms to livestock farms in order to evade their coverage in the
agrarian reform program. Petitioners arguments fail to impress.
Administrative agencies are endowed with powers legislative in
nature,i.e.,the power to make rules and regulations. They have been
granted by Congress with the authority to issue rules to regulate
the implementation of a law entrusted to them. Delegated
rule-making has become a practical necessity in modern governance
due to the increasing complexity and variety of public functions.
However, while administrative rules and regulations have the force
and effect of law, they are not immune from judicial review.[12]
They may be properly challenged before the courts to ensure that
they do not violate the Constitution and no grave abuse of
administrative discretion is committed by the administrative body
concerned.The fundamental rule in administrative law is that,to be
valid, administrative rules and regulationsmust be issued by
authority of a law andmust not contravene the provisions of the
Constitution.[13]The rule-making power of an administrative agency
may not be used to abridge the authority given to it by Congress or
by the Constitution.Nor can it be used to enlarge the power of the
administrative agency beyond the scope intended.Constitutional and
statutory provisions control with respect to what rules and
regulations may be promulgated by administrative agencies and the
scope of their regulations.[14]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 lands exclusively devoted to livestock, swine and poultry-
raising. The Court clarified in theLuz Farmscasethat livestock,
swine and poultry-raising are industrial activities and do not fall
within the definition of agriculture or agricultural activity. The
raising of livestock, swine and poultry is different from crop or
tree farming. It is an industrial, not an agricultural, activity. A
great portion of the investment in this enterprise is in the form
of industrial fixed assets, such as: animal housing structures and
facilities, drainage, waterers and blowers, feedmill with grinders,
mixers, conveyors, exhausts and generators, extensive warehousing
facilities for feeds and other supplies, anti-pollution equipment
like bio-gas and digester plants augmented by lagoons and concrete
ponds, deepwells, elevated water tanks, pumphouses, sprayers, and
other technological appurtenances.[15]Clearly, petitionerDAR has no
power to regulate livestock farms which have been exempted by the
Constitution from the coverage of agrarian reform. It has exceeded
its power in issuing the assailed A.O.The subsequent case ofNatalia
Realty, Inc. v. DAR[16]reiterated our ruling in theLuz Farmscase.
InNatalia Realty,the Court heldthat industrial, commercial and
residential lands are not covered by the CARL.[17] We stressed anew
thatwhile 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, inNatalia
Realty,even portions of the Antipolo Hills Subdivision, which
arearable yetstill undeveloped,could not be considered as
agricultural lands subject to agrarian reform as these lots were
already classified as residential lands. A similar logical
deduction should be followed in the case at bar. Lands devoted to
raising of livestock, poultry and swine have been classified as
industrial, not agricultural, lands and thus exempt from agrarian
reform. Petitioner DAR argues that, in issuing the impugned A.O.,
it was seeking to address the reports it has received that some
unscrupulous landowners have been converting their agricultural
lands to livestock farms to avoid their coverage by the agrarian
reform. Again, we find neither merit nor logic in this
contention.The undesirable scenario which petitioner seeks to
prevent with the issuance of the A.O. clearly does not apply in
this case.Respondents family acquired their landholdings as early
as 1948. They have long been in the business of breeding cattle in
Masbate which is popularly known as the cattle-breeding capital of
the Philippines.[18]Petitioner DAR does not dispute this fact.
Indeed, there is no evidence on record that respondents have just
recently engaged in or converted to the business of breeding cattle
after the enactment of the CARL that may lead one to suspect that
respondents intended to evade its coverage. It must be stressed
that what the CARL prohibits is theconversion of agricultural
landsfor non-agricultural purposesafter the effectivity of the
CARL.There has been no change of business interest in the case of
respondents.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 hand, by making a new law,
Congress seeks to supersede an earlier one.[19] In the case at bar,
after the passage of the 1988 CARL, Congress enacted R.A. No.
7881[20]which amended certain provisions of the CARL.
Specifically,the new law changed 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.[21]With this significant modification, Congress
clearly sought to align the provisions of our agrarian laws with
the intent of the 1987 Constitutional Commission to exclude
livestock farms from the coverage of agrarian reform.In sum, it is
doctrinal that rules of administrative bodies must be in harmony
with the provisions of the Constitution. They cannot amend or
extend the Constitution. To be valid, they must conform to and be
consistent with the Constitution. In case of conflict between an
administrative order and the provisions of the Constitution, the
latter prevails.[22] The assailed A.O. of petitioner DAR was
properly stricken down as unconstitutional as it enlarges the
coverage of agrarian reform beyond the scope intended by the 1987
Constitution.IN VIEW WHEREOF,the petition is DISMISSED. The
assailed Decision and Resolution of the Court of Appeals, dated
September 19, 2003 and February 4, 2004, respectively, are
AFFIRMED. No pronouncement as to costs.SO ORDERED.
Republic of the PhilippinesSUPREME COURTManilaEN BANCG.R. No.
100091 October 22, 1992CENTRAL MINDANAO UNIVERSITY REPRESENTED ITS
PRESIDENT DR. LEONARDO A. CHUA,petitioner,vs.THE DEPARTMENT OF
AGRARIAN REFORM ADJUDICATION BOARD, THE COURT OF APPEALS and ALVIN
OBRIQUE, REPRESENTING BUKIDNON FREE FARMERS AGRICULTURAL LABORERS
ORGANIZATION (BUFFALO),respondents.CAMPOS, JR.,J.:This is a
Petition for Review onCertiorariunder Rule 65 of the Rules of Court
to nullify the proceedings and decision of the Department of
Agrarian Reform Adjudication Board (DARAB for brevity) dated
September 4, 1989 and to set aside the decision the decision * of
the Court of Appeals dated August 20, 1990, affirming the decision
of the DARAB which ordered the segregation of 400 hectares of
suitable, compact and contiguous portions of the Central Mindanao
University (CMU for brevity) land and their inclusion in the
Comprehensive Agrarian Reform Program (CARP for brevity) for
distribution to qualified beneficiaries, on the ground of lack of
jurisdiction.This case originated in a complaint filed by
complainants calling themselves as the Bukidnon Free Farmers and
Agricultural Laborers Organization (BUFFALO for brevity) under the
leadership of Alvin Obrique and Luis Hermoso against the CMU,
before the Department of Agrarian Reform for Declaration of Status
as Tenants, under the CARP.From the records, the following facts
are evident. The petitioner, the CMU, is an agricultural
educational institution owned and run by the state located in the
town of Musuan, Bukidnon province. It started as a farm school at
Marilang, Bukidnon in early 1910, in response to the public demand
for an agricultural school in Mindanao. It expanded into the
Bukidnon National Agricultural High School and was transferred to
its new site in Managok near Malaybalay, the provincial capital of
Bukidnon.In the early 1960's, it was converted into a college with
campus at Musuan, until it became what is now known as the CMU, but
still primarily an agricultural university. From its beginning, the
school was the answer to the crying need for training people in
order to develop the agricultural potential of the island of
Mindanao. Those who planned and established the school had a vision
as to the future development of that part of the Philippines. On
January 16, 1958 the President of the Republic of the Philippines,
the late Carlos P. Garcia, "upon the recommendation of the
Secretary of Agriculture and Natural Resources, and pursuant to the
provisions of Section 53, of Commonwealth Act No. 141, as amended",
issued Proclamation No. 476, withdrawing from sale or settlement
and reserving for the Mindanao Agricultural College, a site which
would be the future campus of what is now the CMU. A total land
area comprising 3,080 hectares was surveyed and registered and
titled in the name of the petitioner under OCT Nos. 160, 161 and
162.1In the course of the cadastral hearing of the school's
petition for registration of the aforementioned grant of
agricultural land, several tribes belonging to cultural
communities, opposed the petition claiming ownership of certain
ancestral lands forming part of the tribal reservations. Some of
the claims were granted so that what was titled to the present
petitioner school was reduced from 3,401 hectares to 3,080
hectares.In the early 1960's, the student population of the school
was less than 3,000. By 1988, the student population had expanded
to some 13,000 students, so that the school community has an
academic population (student, faculty and non-academic staff) of
almost 15,000. To cope with the increase in its enrollment, it has
expanded and improved its educational facilities partly from
government appropriation and partly by self-help measures.True to
the concept of a land grant college, the school embarked on
self-help measures to carry out its educational objectives, train
its students, and maintain various activities which the government
appropriation could not adequately support or sustain. In 1984, the
CMU approved Resolution No. 160, adopting a livelihood program
called "Kilusang Sariling Sikap Program" under which the land
resources of the University were leased to its faculty and
employees. This arrangement was covered by a written contract.
Under this program the faculty and staff combine themselves to
groups of five members each, and the CMU provided technical
know-how, practical training and all kinds of assistance, to enable
each group to cultivate 4 to 5 hectares of land for the lowland
rice project. Each group pays the CMU a service fee and also a land
use participant's fee. The contract prohibits participants and
their hired workers to establish houses or live in the project area
and to use the cultivated land as a collateral for any kind of
loan. It was expressly stipulated that no landlord-tenant
relationship existed between the CMU and the faculty and/or
employees. This particular program was conceived as a
multi-disciplinary applied research extension and productivity
program to utilize available land, train people in modern
agricultural technology and at the same time give the faculty and
staff opportunities within the confines of the CMU reservation to
earn additional income to augment their salaries. The location of
the CMU at Musuan, Bukidnon, which is quite a distance from the
nearest town, was the proper setting for the adoption of such a
program. Among the participants in this program were Alvin Obrique,
Felix Guinanao, Joven Caballero, Nestor Pulao, Danilo Vasquez,
Aronio Pelayo and other complainants. Obrique was a Physics
Instructor at the CMU while the others were employees in the
lowland rice project. The other complainants who were not members
of the faculty or non-academic staff CMU, were hired workers or
laborers of the participants in this program. When petitioner Dr.
Leonardo Chua became President of the CMU in July 1986, he
discontinued the agri-business project for the production of rice,
corn and sugar cane known as Agri-Business Management and Training
Project, due to losses incurred while carrying on the said project.
Some CMU personnel, among whom were the complainants, were laid-off
when this project was discontinued. As Assistant Director of this
agri-business project, Obrique was found guilty of mishandling the
CMU funds and was separated from service by virtue of Executive
Order No. 17, the re-organization law of the CMU.Sometime in 1986,
under Dr. Chua as President, the CMU launched a self-help project
called CMU-Income Enhancement Program (CMU-IEP) to develop
unutilized land resources, mobilize and promote the spirit of
self-reliance, provide socio-economic and technical training in
actual field project implementation and augment the income of the
faculty and the staff.Under the terms of a 3-party Memorandum of
Agreement2among the CMU, the CMU-Integrated Development Foundation
(CMU-IDF) and groups or "seldas" of 5 CMU employees, the CMU would
provide the use of 4 to 5 hectares of land to a selda for one (1)
calendar year. The CMU-IDF would provide researchers and
specialists to assist in the preparation of project proposals and
to monitor and analyze project implementation. The selda in turn
would pay to the CMU P100 as service fee and P1,000 per hectare as
participant's land rental fee. In addition, 400 kilograms of the
produce per year would be turned over or donated to the CMU-IDF.
The participants agreed not to allow their hired laborers or member
of their family to establish any house or live within vicinity of
the project area and not to use the allocated lot as collateral for
a loan. It was expressly provided that no tenant-landlord
relationship would exist as a result of the Agreement.Initially,
participation in the CMU-IEP was extended only to workers and staff
members who were still employed with the CMU and was not made
available to former workers or employees. In the middle of 1987, to
cushion the impact of the discontinuance of the rice, corn and
sugar cane project on the lives of its former workers, the CMU
allowed them to participate in the CMU-IEP as special
participants.Under the terms of a contract called Addendum To
Existing Memorandum of Agreement Concerning Participation To the
CMU-Income Enhancement Program,3a former employee would be grouped
with an existing selda of his choice and provided one (1) hectare
for a lowland rice project for one (1) calendar year. He would pay
the land rental participant's fee of P1,000.00 per hectare but on a
charge-to-crop basis. He would also be subject to the same
prohibitions as those imposed on the CMU employees. It was also
expressly provided that no tenant-landlord relationship would exist
as a result of the Agreement.The one-year contracts expired on June
30, 1988. Some contracts were renewed. Those whose contracts were
not renewed were served with notices to vacate.The non-renewal of
the contracts, the discontinuance of the rice, corn and sugar cane
project, the loss of jobs due to termination or separation from the
service and the alleged harassment by school authorities, all
contributed to, and precipitated the filing of the complaint.On the
basis of the above facts, the DARAB found that the private
respondents were not tenants and cannot therefore be beneficiaries
under the CARP. At the same time, the DARAB ordered the segregation
of 400 hectares of suitable, compact and contiguous portions of the
CMU land and their inclusion in the CARP for distribution to
qualified beneficiaries.The petitioner CMU, in seeking a review of
the decisions of the respondents DARAB and the Court of Appeals,
raised the following issues:1.) Whether or not the DARAB has
jurisdiction to hear and decide Case No. 005 for Declaration of
Status of Tenants and coverage of land under the CARP.2.) Whether
or not respondent Court of Appeals committed serious errors and
grave abuse of discretion amounting to lack of jurisdiction in
dismissing the Petition for Review onCertiorariand affirming the
decision of DARAB.In their complaint, docketed as DAR Case No. 5,
filed with the DARAB, complainants Obrique, et al. claimed that
they are tenants of the CMU and/or landless peasants
claiming/occupying a part or portion of the CMU situated at
Sinalayan, Valencia, Bukidnon and Musuan, Bukidnon, consisting of
about 1,200 hectares. We agree with the DARAB's finding that
Obrique, et. al. are not tenants. Under the